The video explains how Apple has struggled to keep up with AI advancements, particularly with Siri, leading to delays, internal conflicts, and ultimately a costly partnership with Google to license their Gemini AI model. It also discusses the uncertain consumer demand for AI in smartphones and suggests that Apple’s cautious, pragmatic approach to AI may reflect a broader industry trend toward leveraging existing AI technologies rather than building them entirely in-house.
The video discusses Apple’s struggles and setbacks in the field of artificial intelligence, particularly focusing on Siri and the company’s broader AI ambitions. Despite confident statements from Apple executives in late 2023, by 2025 it became clear that Apple was falling behind competitors like Google. Siri remains outdated and ineffective, failing to deliver on promised AI features that were heavily marketed as key highlights of the iPhone 16. Internal frustrations culminated in a senior Apple director describing the delays as “ugly and embarrassing,” and Apple has now taken the unprecedented step of partnering with Google, paying $1 billion annually to use a customized version of Google’s Gemini AI model to power Siri, while maintaining user privacy by running the model on Apple’s private cloud.
The video questions the actual consumer demand for AI in smartphones, noting that AI features are not a top priority for most buyers. Surveys show a decline in users upgrading phones specifically for AI capabilities, and many find mobile AI unhelpful or unnecessary. Even Samsung, which heavily promoted AI in its Galaxy phones, has seen weak market responses. While AI can enhance certain functions, it is not yet a must-have feature for the majority of consumers. However, Apple would still benefit from improving Siri, which has long lagged behind Google’s voice assistant in performance and reliability.
Apple’s internal AI efforts have been plagued by dysfunction and delays. The company’s AI team split into factions, and the rapid rise of generative AI technologies like ChatGPT caught Apple off guard, leading to scrambling and missed deadlines. Promised features for the new Siri and Apple Intelligence largely failed to materialize, resulting in lawsuits over false advertising and finger-pointing between marketing and engineering teams. Key AI leaders left the company, and attempts to partner with other AI firms like Anthropic fell through due to cost disagreements. Ultimately, Apple’s decision to license Google’s Gemini model appears to be a stopgap while they continue developing their own AI technology.
The video also explores the broader implications of Apple’s move to lease AI technology rather than build it entirely in-house. It suggests that large language models (LLMs) like Gemini may become commoditized, with companies focusing more on building applications on top of existing AI models rather than investing billions to create foundational AI from scratch. This approach could represent a more cost-effective and practical strategy for many companies, including Apple, which can leverage powerful third-party AI to enhance products like Siri without the massive expense and risk of developing their own models.
Despite the embarrassment of falling behind in AI, Apple’s overall business remains strong, with iPhone sales rebounding and MacBooks gaining market share. The video concludes by inviting viewers to consider their own views on AI in smartphones—whether it is a valuable feature or an overrated gimmick—and reflects on Apple’s cautious approach to AI as possibly a sign of prudence rather than failure. The story highlights the complex challenges of integrating AI into consumer products and the evolving landscape of AI development and deployment in the tech industry.