
Apple has stayed quiet when it comes to the development of products and services before they are released, and this has caused worry that in the area of artificial intelligence it is not keeping up with competitors. Nonetheless, Apple has acquired a large number of AI startups in the recent past, and included software in its newly updated smartphones, computers, watches, apps, operating systems and Vision Pro VR headset. What is probably Apple's strongest point is the sizable iOS user base of two billion people, and this could remain as Cupertino's greatest prospect in utilizing machine learning.
Since 2015, Apple has been quietly acquiring over two dozen artificial intelligence companies, such as Emotient, Laserlike, Drive.ai, AI.Music and WaveOne, embedding their technologies into the company's upgraded range of products like iPhones, computers, watches, streaming services, operating systems and mobile apps, as well as the Vision Pro mixed-reality headset set for release next year. Apple has been quite reserved about its overall AI strategy, including its internal R&D, while tech competitors such as Microsoft, Google, Meta and Amazon have been very vocal about their generative AI chatbots and large language model (LLM) platforms. According to Wedbush Securities analyst Dan Ives, "That's the DNA of Cook and Cupertino. They tend not to talk until they release." Returns from Apple's AI approach, however, are expected to significantly impact their consumer-centric business model. Unlike its rivals, who focus on building separate generative AI models, Apple has directed their attention to machine learning infrastructure. PitchBook's Brendan Burke claimed that Apple has been targeting "consumer applications of AI primarily, but also operational techniques for machine-learning deployment and edge devices, as well as limited bets on the future of deep learning and more horizontal technologies". Apple had yet to respond to requests for comment prior to their earnings report on Thursday.
When Apple speaks about its AI ambitions, its comments are more discreet, whether that be when CEO Tim Cook appeared on "Good Morning America" or during an earnings report call with analysts and investors in August. On that call, Cook mentioned, "We understand AI and machine learning as essential, basic technologies that are essential to the majority of the products we construct. Also, we've been exploring a broad array of AI technologies, including generative AI, for many years," he commented. "We are going to keep investing, innovating and advancing our products with these technologies, with the primary aim of improving people's lives. We tend to make announcements about products as they become available, and that's our general approach, and we would like to continue with it."To that point, the most recent iPhone and Watch models display Apple's AI capabilities. The iPhone 15 has a few AI features, such as individualized voice, which allows users to generate a voice like their own so they can say words they type in FaceTime and phone calls, and live voicemail, a real-time transcription of messages. The upgraded camera uses AI to differentiate between a person and an object in the frame. The Apple Watch Series 9 and Ultra 2 include AI in the double-tap feature to do tasks more simply, a brighter display, more intelligent Siri and advanced health tracking.AI is also incorporated into Vision Pro, particularly its amalgamation with FaceTime, Apple said in introducing the headset, which it calls a spatial computer. Users are able to produce representations of themselves with machine-learning systems, allowing them to do things together such as watch a video, browse photos or collaborate on a presentation.Nevertheless, the advancement from app to app and device to device hasn't shielded Apple from criticism that it is behind. Laura Martin, a tech analyst at Needham, is among those who state Apple is "considerably behind" its main tech opponents. "The future is generative AI and Apple isn't doing that," she said. Even so, Martin added, "I'm not sure it matters, because they have an ecosystem, an economic model" that is tailored towards machine-learning. "Apple's ecosystem is okay and will remain growing," she stated.The early lead in generative AI is rewarding for competitors, as was exhibited by Microsoft's latest earnings report. But the one benefit Apple has that its tech rivals don't: the most profitable installed base in the world, more than two billion users running its iOS operating software on devices.That's why bullish analysts don't look at the competition for Apple as an open competition with the generative AI platforms being pursued by Microsoft, Google and Amazon. Comparisons being made today to the first wave of cloud adoption – and generative AI ecosystems now being referred to as Cloud 2.0 – are a useful guide as to why it may be more of a joint development process than a race. As Amazon Web Services, Microsoft Azure, and to some extent Google Cloud, gained market share as more enterprises shifted to cloud-based computing, Apple didn't attempt to join in. "They won’t look at AI from an outsider’s perspective. They will be a major player in AI even though the opinion is they are late to the game," Ives reported. "We think they are on the verge of what will be the launch of an AI App Store in the next year," he said.The billions spent on AILast week, Bloomberg reported that in a rush to "catch up" Apple would invest $1 billion a year on generative AI. Ives believes this is a large under-estimation of the sum Apple is likely to spend, and already has been spending, on AI. He expects Apple to allocate up to $5 billion a year on AI and claims it has already spent $10 billion on AI research and development in the last few years to make the foundation for engineers to build AI apps – a level that would be equivalent to Microsoft's expenditure. "That's the holy grail for them, the AI App Store. That's where they can make money in an unprecedented way," Ives said.It's a development opportunity that would utilize what has been one of the most significant components of the Apple narrative in recent years, the growth of its services industry, which is now a $100 billion revenue stream by itself. Within an AI App Store, the possibilities can go far beyond essential Apple products like Music, to a huge array of health and fitness apps, for example, and in the end provide an extra $5 billion to $10 billion a year in services revenue, as per Ives' count.Cook's solitary reference of generative AI to analysts helped fuel speculation as to just what Apple will — or won't — do in that fiercely competitive area, headed by Microsoft's contribution with OpenAI and ChatGPT and its own Bing AI chatbot, Google's Bard bot and Meta's LLM-based virtual assistant, Meta AI.In July, Bloomberg reported that Apple was developing AI tools to rival those bots with its own LLM, named Ajax, and has built a chatbot, Apple GPT, for internal use.In August, the Financial Times reported that Apple was "bulking up its expertise in generative AI" by recruiting dozens of people in California, Seattle, Paris and Beijing to work on LLMs. Actually, Apple's careers website invites job-seekers to "join a team of researchers and engineers with a proven track record in a variety of machine learning methods," including generative AI models.However, there is a downside to its ecosystem, which adheres to data privacy and design excellence, and could be an obstacle for whatever Apple does in generative AI, Burke mentioned, or in the least, explain why it may be released at a slower pace. "Apple just wants to launch products that are secure, private and meet internal quality criteria, so that reduces their speed of deployment," he said. "So I think Apple will wait to release any platform technologies until they are really advantageous to its ecosystem."Meanwhile, Burke said, it is sensible to assume that Apple will keep investing in AI, whether via more acquisitions of startups or partnerships with developers, and actions being taken by competitors won’t go unnoticed. Referring to Amazon's recent investment of up to $4 billion in Anthropic, a startup that has rolled out an AI chatbot called Claude 2, he said, "Apple could feel comparable pressure to collaborate with leading startups to supplement its internal R&D initiatives," he said. "Particularly as startups continue to achieve cutting-edge outcomes with LLMs and add new image- and video-based features that could be applicable to Apple. That could be a viable addition to what it's doing."
Amazon is set to inject up to $4 billion into AI startup Anthropic, an error having been made in the earlier report of the investment terms.
Comentarios