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On March 18, Bloomberg reported that Apple is seeking to collaborate with Google on a significant deal to utilize the Gemini AI model for various features on the iPhone. This move would further strengthen Google's position, as the company already holds a deal with Apple as the preferred search engine provider for the Safari browser on iPhones.

Gemini is Google's suite of generative AI tools, spanning from chatbots to coding assistants.

According to sources familiar with the matter cited by Bloomberg, Apple is exploring the possibility of licensing Google's AI technology to integrate AI-powered features into iOS updates later this year. Furthermore, the company has reportedly engaged in discussions with OpenAI regarding the potential utilization of GPT models.

Apple is anticipated to potentially unveil iOS 18, its newest operating system for the iPhone, at its Worldwide Developer's Conference (WWDC) in June.

The negotiations are centered around licensing Gemini for certain new features set to be introduced in iPhone software later this year, as per the report. It mentioned that the specifics of the AI agreement, including terms, branding, and implementation methods, have yet to be finalized. Any potential deal announcement is unlikely before June, coinciding with Apple's annual developers' conference.

Additionally, the report notes that Apple has recently engaged in discussions with OpenAI, the creator of ChatGPT, regarding the potential integration of its model.

The long-standing partnership between Apple and Google, which includes Google being the default search engine on Apple's Safari web browser, could potentially benefit from a collaboration on generative AI technology like Gemini. Such a tie-up may address concerns within Google about emerging services like ChatGPT posing a threat to its search dominance.

However, any agreement between the two tech giants could draw increased scrutiny from U.S. regulators, who have accused Google of unlawfully maintaining its search monopoly by paying substantial sums to Apple. This scrutiny comes amidst ongoing legal battles between Google and regulators.

In January 2024, Google announced a partnership with Apple's competitor Samsung to integrate its genAI technology into the Galaxy S24 series of smartphones. This move aims to further promote the adoption of Gemini following initial challenges during its rollout.

Apple's CEO, Tim Cook, recently stated that the company is making significant investments in generative AI and plans to unveil more details about its utilization later this year. According to Bloomberg's report, while Apple intends to leverage its own AI models for certain capabilities in the upcoming iOS 18, it seeks a partner to power genAI features, such as image creation and essay writing based on simple prompts.

In premarket trading at 5:36 a.m. ET on March 18, Alphabet's Class A shares showed a 2.99% increase, while its Class C shares were up by 3.09%. On the other hand, Apple shares were trading approximately 0.53% higher during the same period.

Source:
CNBC
Bloomberg

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