Apple and Google are discussing a deal to bring generative AI to iPhones

Apple is in talks with Google about using the search giant’s generative artificial intelligence model, called Gemini, for its next iPhone, as the company races to embrace a technology that has upended the tech industry.

The talks are preliminary and the exact scope of a potential deal has not yet been defined, three people with knowledge of the talks said. Apple has also been in talks with other AI companies, one of these people said, as it wants to tap the power of a large language model capable of analyzing large amounts of data and generating text on its own.

Apple CEO Tim Cook has promised investors that the company will introduce new generative AI capabilities later this year. The company’s smartphone rivals, Samsung and Google, have already added Gemini to their latest devices to edit videos and synthesize audio recordings.

Apple and Google declined to comment. Bloomberg previously reported on the talks between Apple and Google.

A deal between Apple and Google on generative AI would continue one of the longest-standing partnerships in technology. Since Apple introduced the iPhone in 2007, Google has made a crucial contribution to the device’s success. It initially provided Google Maps for navigation and later struck a deal to become the default search engine in the iPhone’s Safari browser, a lucrative deal for which Google pays Apple more than $18 billion a year.

Google’s discussions to bring generative AI capabilities to the iPhone would be the latest example of filling a gap in Apple’s products. Apple’s efforts to develop its own major language model, the technology behind chatbots like ChatGPT and Google’s Gemini, are lagging behind, say two people familiar with its development.

Apple’s delay in releasing an AI product has been costly. After a decade as the world’s most valuable publicly traded company, it was dethroned this year by Microsoft, which has aggressively pursued AI. The technology is being praised for its potential to disrupt businesses and create trillions of dollars in economic value.

Despite the delays, Apple has the potential to become a major player in the AI ​​field. The company has more than two billion devices in active use, making it an attractive partner for Google and others. It also has a reputation for protecting customers’ private data, which could be useful in a future where AI services help manage people’s schedules or health data.

A deal could bring the Gemini model to iPhones around the world, giving Google access to a huge user base and making generative AI even more mainstream. Virtually overnight, Google could have more consumers using its AI than its main rival, OpenAI, which makes the ChatGPT AI chatbot, making a pact with Apple a tantalizing prospect.

(The New York Times sued OpenAI and Microsoft in December for copyright infringement of news content related to AI systems.)

The choice of Google as AI supplier would be a crucial vote of confidence in the search giant after a number of setbacks in its AI ambitions. The company’s first AI chatbot, Bard, received mediocre reviews last March and struggled to attract as many users as ChatGPT.

In February, Google debuted a new chatbot called Gemini. The chatbot ran into trouble last month when users discovered that the image generator produced illustrations of historical figures that were not racially accurate and refused to show white people, leading to accusations of bias. Google disabled the ability to take images of people and promised to fix the problem.

In a note on Tuesday, Bernstein Research analyst Toni Sacconaghi called an Apple-Google deal a “win-win,” bringing Apple generative AI for iPhones and validating Google’s work on Gemini. He also said that Apple did not need to own an AI model on iPhones to benefit from it and could instead take a commission from Google, which currently charges $19.99 per month for its Gemini Advanced app.

Companies have not yet benefited from generative AI. The costs associated with running large language models in the cloud are enormous, and consumers and enterprise customers are only now beginning to pay for the emerging technology. But they are optimistic that profits will increase as the capabilities of AI systems improve and the costs of building the data centers to power the systems fall.

A new deal between Apple and Google could draw criticism from US regulators. The Justice Department is in the final stages of a lawsuit against Google for violating competition law by paying Apple to be the default search engine on the iPhone and other services. Judge Amit P. Mehta of the U.S. District Court for the District of Columbia, who is presiding over the non-jury trial, is expected to issue a verdict this year.