Recent reports reveal that Google is in discussions with Apple to embed its Gemini AI into iPhones. This potential partnership could be a game-changer for both tech giants. For Google, it presents a lucrative opportunity to enhance the reputation of its AI technology, which has faced challenges in the past. On the other hand, it would enable Apple to maintain its competitive edge in the realm of artificial intelligence.
Facing Tough Competition
The launch of OpenAI’s ChatGPT 3 in late 2022 sparked fierce competition among tech companies. Microsoft, in alliance with OpenAI, emerged as the leader in this race with its stock soaring by almost 50% in a year. In contrast, Apple and Google struggled to catch up to the pace set by Microsoft.
In an effort to keep up with Microsoft, Google introduced its response to ChatGPT – Bard, later rebranded as Gemini. However, Google’s AI platform has encountered challenges, characterized by hallucinations and lackluster performance.
Apple faced an even greater setback, lacking an AI platform altogether. The reasons behind this oversight remain speculative, but the repercussions on Apple’s reputation have been tangible, reflected in its modest 4% stock growth compared to the market’s 30% surge.
A Potential Lifeline
While specifics of the deal are still in negotiation, a collaboration between Google and Apple could be a significant boost for both companies. Google’s stock witnessed a 5% jump upon the news with an additional 3% increase since. Apple’s stock experienced a slight 0.5% uptick initially but has faced downward pressure due to other unfavorable developments.
Strategic Considerations
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Featured photo by Chris Liverani on Unsplash