Thu. Jul 25th, 2024

Apple has reportedly held discussions with Meta about partnering on artificial intelligence (AI).

The iPhone maker and the social media giant have discussed integrating Meta’s AI model into Apple’s recently announced Apple Intelligence, The Wall Street Journal (WSJ) reported Sunday (June 23), citing sources familiar with the matter.

The report noted that Meta and other companies working on generative AI products are hoping to take advantage of Apple’s massive distribution. For its part, Apple has said it plans to work with partners such as OpenAI for more complex AI tasks.

“We wanted to start with the best,” said Apple software leader Craig Federighi, adding that ChatGPT “represents the best choice for our users today.” He also said the company also wanted to integrate Google’s AI model Gemini.

Sources told WSJ that Apple has also held talks with AI startups Anthropic and Perplexity about bringing their generative AI to Apple Intelligence. PYMNTS has contacted both companies for comment but has not yet gotten a reply.

The report also looked at the mechanics of AI partnerships, in a conversation with Gene Munster, an Apple analyst and managing partner at Deepwater Asset Management.

He said that while ChatGPT usage is projected to double with the Apple partnership, OpenAI’s infrastructure costs could increase by 30% to 40%.

Munster told WSJ 10% to 20% of Apple users will choose to pay for a premium AI subscription to a product like ChatGPT, something that could mean billions of dollars for AI firms that integrate with Apple Intelligence.

“Distribution is hard to get,” Munster said. “The beauty of what Apple has built is that you’ve got this engaged distribution at scale.”

Apple’s partnership with OpenAI is designed to give Apple’s digital assistant Siri and its writing tools new heft thanks to advanced artificial intelligence capabilities.

While Apple could have used its own AI tech, the company concluded that its customers may want to use other AI solutions, like those that Apple itself sees as industry-leading, like OpenAI’s, PYMNTS wrote earlier this month.

As that report said, the joint effort is reminiscent of the types of partnerships that are “increasingly top of mind” for players in the bank, FinTech and B2B sectors.

“The classic dilemma of whether to build an in-house solution, buy a ready-made product or form a partnership to integrate new technologies has been a cornerstone of business development for decades, but the importance of partnering with third-party vendors has increasingly come to the forefront,” that report said. “The fast-paced evolution of technology and the rising complexity of consumer expectations adds layers of intricacy to this decision.”

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