A partnership between Apple and OpenAI sounds like it could be worth millions, if not billions, of dollars. However, according to a report, Apple won’t be paying Sam Altman’s company anything to bring ChatGPT to Apple platforms. Instead, Cupertino has leveraged its market position to convince OpenAI that the extra exposure from device integration is worth more than money.
Apple announced at its Worldwide Developers Conference that Apple Intelligence features would be arriving in iOS 18, iPadOS 18, and macOS Sequoia this fall. OpenAI’s GPT-4o LLM will power some of the AI tasks, including the option to use ChatGPT to help Siri answer user queries — much to the annoyance of Elon Musk.
Microsoft has invested $13 billion in OpenAI, so it wouldn’t be surprising to learn that Apple had paid the company a hefty sum to use its technologies. Bloomberg reports that no details of the financial terms were released, but according to its sources, Apple isn’t paying OpenAI.
The deal could eventually benefit both tech giants financially. The ChatGPT integration on Apple products will be free to use, though subscribers will get all the usual extra benefits. If free users decide they want the extra perks and subscribe to OpenAI on an Apple device (via the ChatGPT app) using Apple’s payment platform, the company will get a cut.
Getting more people onto its subscription plans, which start at $20 per month, is going to be an attractive prospect for OpenAI, too, especially when there are hundreds of millions of people around the world who use Apple devices.
Apple hasn’t yet announced any future AI partners. It is believed to be in talks with Google to offer Gemini as an additional option to its device users. It has also held talks with Anthropic as a potential chatbot partner. The ultimate goal is to offer a range of AI services, much like choosing a search engine.
Security Implications
The integration aims to allow the chatbot to pull information from the user’s communications to write iMessages and answer other generative prompts in the next operating system. This means the AI engine will collect personal user information and data, putting users at risk, according to Charles Darwin University artificial intelligence associate professor Niusha Shafiabady.
“This risk would not come from the OpenAI deal directly but from collecting data from different sources for each user and potentially entering it into the OpenAI tool,” Shafiabady said.
“Of course, entering the data into a generative AI tool like ChatGPT would create a privacy breach. The data used for the engine, which could potentially be used as training data for the generative AI, will become public domain data.”
This means people will lose their privacy, and it could create another bridge for crossing over people’s security if accessed by malicious actors, Shafiabady said.
Billionaire Elon Musk has also blasted the announcement in a series of tweets and warned that if Apple “integrates OpenAI at the OS level,” all Apple devices will be banned at his companies.
Apple says privacy protections will be built in for users who access ChatGPT — “their IP addresses are obscured, and OpenAI won’t store requests. ChatGPT’s data-use policies apply for users who choose to connect their account.”
But users are right to have concerns about their security, Shafiabady said. “Using and collecting data from emails and different sources of communication opens another door to security risks for the users,” Shafiabady said.
“The users should decide how much they get out of these technologies in trading their privacy and security. These updates aren’t revolutionary. Using the ChatGPT’s engine as a content producer, creating a text-to-speech on top of that content is very simple. Even we were writing these types of codes when we were students 20+ years ago. It is nothing eye-catching technology-wise, and personalizing content is a relatively old concept.”
Other AI Considerations
Apple rejected overtures by Meta Platforms to integrate the social networking company’s AI chatbot into the iPhone months ago, according to people with knowledge of the matter. The two companies aren’t in discussions about using Meta’s Llama chatbot in an AI partnership and only held brief talks in March, said the people, who asked not to be identified because the situation is private.
The dialogue about a partnership didn’t reach any formal stage, and Apple has no active plans to integrate Llama. The preliminary talks occurred around the time Apple started hashing out deals to use OpenAI’s ChatGPT and Alphabet Gemini in its products. The iPhone maker announced the ChatGPT agreement earlier this month and said it was expecting to offer Gemini in the future.
Apple decided not to move forward with formal Meta discussions in part because it doesn’t see the company’s privacy practices as stringent enough, according to the public. Apple has spent years criticizing Meta’s technology, and integrating Llama into the iPhone would have been a stark about-face. They also see ChatGPT as a superior offering.
Google, meanwhile, is already a partner for search in Apple’s Safari web browser, so a future Gemini deal would build on that relationship. Spokespeople for Apple and Meta declined to comment. The Wall Street Journal reported on Sunday that the two companies were in talks about an AI partnership. Apple unveiled a suite of artificial intelligence features at its Worldwide Developers Conference on June 10. The new technology — called Apple Intelligence — includes homegrown tools for summarizing notifications, transcribing voice memos, and generating custom emojis.
But Apple’s chatbot technology isn’t as advanced as that of rivals, prompting it to seek out partners. The company also believes that customers will want the ability to switch between different chatbots depending on their needs, similar to how they might hop between Google and Microsoft’s Bing for searches.
Apple continues to talk to AI startup Anthropic about eventually adding that company’s chatbot as an option. Apple Intelligence will begin rolling out later this year as part of operating systems for the iPhone, iPad, and Mac. The current deal with OpenAI doesn’t involve money swapping hands, but Apple will allow paying ChatGPT customers to access their subscriptions within the iOS operating system.
That could generate revenue for OpenAI, a percentage of which could be headed to Apple in the form of App Store commissions. Meta and Apple were on friendlier terms a decade ago when the iPhone maker was integrating Facebook into iOS. However, the companies have become fierce rivals in recent years, competing over AI, home devices, and mixed-reality headsets.
Concluding Thoughts
Apple’s landmark partnership with OpenAI has made waves for a number of reasons, chief among them being the fact that this integration will occur without money changing hands. OpenAI is hoping to leverage the expanded user base and convert free users to premium subscription users.
Excitement has been tempered by concerns over security and privacy; generative AI that can provide message prompts needs to have access to messages. One of the loudest voices in regard to this has been Elon Musk, who has issued a warning that employees with Apple devices would be banned from bringing their phones to work.
OpenAI may be the first to secure a coveted Apple integration, they may not be the last. Meta cast their hat in the ring, but talks didn’t go too far as they’re considered too direct a competitor. Ideally, they’d like consumers to have their pick of AI tools, and seem willing to partner with Alphabet’s Gemini.
