Google is very strong in LLMs as well, they have several models of excellent quality. For example Google PaLM is 3x bigger than GPT-3.

However, it is rumored that Bard is a scaled down version of Lamda, only a 2B parameter model but trained on a lot more data than GPT-3. The size would probably make it somewhat less powerful, but also dramatically cheaper to run. It is also possible they have some secret sauce that would make a lot smaller model competitive. We shall see.

I think the Google's problem is that they currently completely dominate search and any disruption is simply not good for them as they have everything to lose and not much to gain. Also search is pretty much the only way Google makes money. So this is existential for them. But make no mistake, they are the clear leader in AI in spite of recent advances by OpenAI and Microsoft.