Apple-Google partnership should ‘de-risk’ AI for iPhone maker

00:00 Julia

As we’ve talked about, our tech editor Dan Halley says he’s not convinced that people are going to buy an iPhone because of the AI, just like they weren’t buying it because of Siri, for example. I know you feel a little bit differently about that. Do you think that um Apple is starting to make some more significant progress on that front?

00:15 Tom

So first off, I think that the strategic partnership with Google essentially de-risks AI for Apple uh as it relates to investors’ concerns about it.

00:26 Tom

Now, my what’s going to sound strange view here is that I think that being slow to have an AI product is actually working in Apple’s favor because I think you’re seeing a lot of consumers recognize that there’s, you know, for example, a lot of hallucinations going on and that some of the other companies that have AI products on the market today, those products aren’t necessarily perfect and in many cases are flawed.

00:59 Tom

So I actually think that in in and again, I didn’t think it would play out this way at all. But the being slow to market with AI, actually think it has worked in Apple’s favor.

01:09 Tom

Uh but the good news is, and yes, I’m skeptical like Dan that uh Siri is going to be materially better when enhanced with AI, but I do think that over time, I expect Apple to at least be at par with the market when it comes to consumer services related to AI.

01:25 Julia

Tom, kind of to your point about the delay, like have we figured out what the killer app is in terms of AI usefulness on the phone?

01:37 Tom

So it seems like, so I also wonder Julia about the open AI ability to generate a profitable business from from AI. So stepping back and just looking at AI at the industry level rather than Apple specific. So, I think it’s unclear. Um, I if you look at meta platforms, they’re clearly benefiting from using artificial intelligence to improve the relevancy of their advertising and improve their digital advertising effort.

02:12 Tom

But that would be more of a I guess a commercial solution for AI than necessarily one as a consumer. Um, there’s a lot of usage as it relates to search. But I anecdotally feel that Gemini isn’t necessarily materially better than what I see from the legacy search results from Google and things of that nature.

02:32 Tom

So yeah, I I think again, it’s unclear to me what the killer consumer app is as it pertains to AI and I think that’s benefiting Apple in being slow to market.