Apple (AAPL) unveiled its long-awaited AI strategy, showcasing the new “Apple Intelligence” technology at its annual developer conference. This technology integrates across Apple’s suite of apps, including Siri, and brings OpenAI’s chatbot ChatGPT to its devices.
Enhancements to Siri
In a nearly two-hour-long presentation, CEO Tim Cook and other executives highlighted how the revamped Siri will now interact with messages, emails, calendars, and third-party apps. Siri will be able to write emails and adjust its tone to suit different occasions. Craig Federighi, an Apple executive, described Apple Intelligence as “AI for the rest of us.”
Focus on Privacy
Apple emphasized its focus on user privacy, aiming to set itself apart from rivals Microsoft (MSFT) and Google. Privacy will be at the core of Apple’s AI features. The tie-up with OpenAI includes safeguards, such as Siri seeking user permission before querying ChatGPT.
Wall Street’s Lukewarm Response
Despite the announcements, Wall Street’s reaction was less than enthusiastic. Apple’s shares closed down nearly 2% following the event. Analysts like Dipanjan Chatterjee from Forrester and Paolo Pescatore from PP Foresight noted that while the new AI features are useful, they do not significantly advance Apple’s competitive position against Microsoft and Alphabet.
AI Features and Developer Tools
The new AI features will be available with Apple’s latest operating system, iOS 18. This includes Private Cloud Compute, which handles more complex tasks on Apple’s servers, ensuring user data safety. Apple also plans to use a combination of on-device processing and cloud computing, making the features available on the latest iPhones, starting with the iPhone 15 Pro.
Siri’s Expanded Capabilities
The revamped Siri aims to overcome past limitations by understanding user intentions better and integrating more seamlessly with apps. However, this integration has raised privacy concerns, notably from Tesla CEO Elon Musk, who threatened to ban Apple devices at his companies if Apple’s integration with ChatGPT compromises privacy.
New Features and Vision Pro Expansion
Apple announced additional features, such as a customizable iPhone home screen, an “app lock” feature for better data protection, and the expansion of its mixed-reality headset Vision Pro to eight more countries, including China and Japan. The new VisionOS 2 software will use machine learning to enhance photos and introduce new gestures.
Apple’s AI strategy, centered around enhancing user experience and privacy, aims to convince its extensive user base of the benefits of nascent AI technology. However, the immediate impact on Apple’s competitive standing in the AI landscape remains uncertain.