Apple and Meta contemplate a potential AI collaboration.
Apple is set to make a major move in the artificial intelligence (AI) sector with Apple Intelligence, but details about the specific software products to be integrated are still murky. There's even a potential partnership with rival Meta on the table.
Reports suggest that Apple is engaging in discussions with Meta regarding the integration of Meta's generative AI model into Apple Intelligence, Apple's AI system announced for iPhones and other devices. The goal is for Meta and other generative AI developers to capitalize on Apple's extensive iPhone user base. As a late entrant in the generative AI realm, Apple has developed its own smaller AI models, but has announced that it will rely on partners for more complex or specialized tasks.
Upon the introduction of Apple Intelligence at the Worldwide Developers Conference, ChatGPT from OpenAI was named the first partner of the company. Craig Federighi, Apple's software chief, stated, "We wanted to start with the best," attributing ChatGPT's selection as the best choice for users. He also hinted at plans to incorporate Google's Bard as well.
Selection of Models
aside from Google and Meta, AI startups Anthropic and Perplexity were also in discussions with Apple to incorporate their generative AI into Apple Intelligence. If Apple secures deals beyond OpenAI, customers could opt to use additional external AI models alongside Apple's internal systems, according to the company.
The talks with Meta highlight the new connections being forged between large tech companies in the AI era. OpenAI's technology is anticipated to be integrated into devices from Microsoft and Apple. A partnership between Apple and Meta would be noteworthy, given their past tech-related disagreements.
In its talks with other AI companies, Apple did not seek to financially compensate one party over the other. Instead, AI companies can offer premium subscription options for their services through Apple Intelligence, with Apple retaining a portion of the revenue, similar to its App Store model.
The negotiations are not yet finalized and could still falter. Although partnerships with Apple could significantly expand the user bases of AI companies, the financial benefits remain uncertain. OpenAI will provide a free version of ChatGPT through Apple Intelligence, but users can also link a premium ChatGPT account to their Apple device.
Meta could reap substantial benefits
The partnership with Apple could potentially double the use of ChatGPT, but OpenAI's infrastructure costs could increase by 30-40%, according to Gene Munster, a long-time Apple analyst and managing partner at Deepwater Asset Management. Munster estimates that 10-20% of Apple users might opt for a premium AI subscription for a product like ChatGPT, which could translate into billions of dollars for successful AI companies that integrate into Apple's new platform.
A partnership with Meta would boost Meta's endeavors in the AI competition within the Tech Industry and represents a rare alliance between the Social Media Giant and the iPhone Manufacturer.
By engaging in discussions with a range of AI companies, Apple can avoid undue reliance on OpenAI. However, it remains to be seen how open Apple will be in making its new AI platform accessible to these external AI companies. The AI agreements require negotiation for each company, as opposed to the App Store where there is an established process.
Federighi stated that it makes sense for Apple to offer a variety of AI options, as users have preferences for different models for various tasks, such as creative writing or medical information research. "People will want to refer to this type of expertise in this way, which may not be part of our core business", he said at the Developer Conference.
