Apple Opts-In to OpenAI

...and you'll apparently have to as well
Apple Made Once-Unlikely Deal With Sam Altman to Catch Up in AI
An OpenAI agreement is due to be announced at the Apple’s developer conference next week.

A few new details on the Apple/OpenAI deal from Mark Gurman worth calling out:

When a 23-year-old Sam Altman took the stage at Apple Inc.’s annual developer conference in 2008, he gushed about being able to use the company’s new App Store to promote his software, a friend-locating service called Loopt. “We think this is a new era of mobile, and we’re thrilled to be part of it,” Altman said.

Now, 16 years later, Apple is calling upon the entrepreneur again — but with a twist. This time, the company needs his help as much as he needs Apple.

Altman currently runs OpenAI, the leading startup in generative artificial intelligence. And Apple, racing to catch up in that area, has forged a partnership to integrate OpenAI’s ChatGPT into the iPhone’s operating system. Though the controversial Altman is unlikely to take the stage at the event, the agreement will be a key focus of Apple’s Worldwide Developers Conference next week — and it shows just how much the power in Silicon Valley has shifted over the past few years.

As I wrote back in April, when the partnership was still just a rumor – and seemingly a second-fiddle to discussions with Google around Gemini:

Google is obvious because of the aforementioned search partnership. But OpenAI is more of a wildcard. Then again, remember who was on stage at WWDC in 2008... That's right, one very young Sam Altman, rocking and popping not one but two collars, no less. How great of a moment would it be for Sam to strut back out on stage in the same watermelon ensemble exactly 15 years later to announce an Apple/OpenAI partnership?2 The crowd would go wild. Boom.3 Ship it.

Those two footnotes are interesting as well:

2 You know who else Apple doesn't like too much? Elon Musk. The estranged OpenAI co-founder currently suing the startup...

3 Altman, of course, was on stage to showcase Loopt, his location-based social network -- one of the first in the then-new App Store. The subtle message in bringing him back would be that Altman got his start thanks to working with Apple all those years ago...

It's too bad that Gurman believes Altman is "unlikely to take the stage" since it would be such a great call back – a decidedly less subtle one if he was indeed rocking that attire again. But on a more serious note, per footnote 3 above, it would also be a nice moment and huge testament to what Apple built in the form of the App Store all those years ago – something which everyone, including OpenAI itself, now tries to emulate to help launch that next generation of entrepreneurs like Altman.

Apple, of courses, has a long history of bringing key partners up on stage at events, and certainly Altman would qualify in this case. But perhaps the whole recent GPT-4o/Her/Sky/Scarlett spat put a little too much heat around Altman for the very Hollywood-friendly Apple. Then again, per footnote 2, it would be a way to stick it to Elon Musk in a way, so perhaps there's still hope...

Around the time of the ChatGPT launch, small teams within the company’s AI and software engineering divisions began working on a competitor to ChatGPT, using a framework dubbed Ajax.

Software chief Craig Federighi pushed managers to pack the latest version of the iPhone and iPad operating system — known internally as “Crystal” — with as much AI as possible. Eddy Cue’s services division got to work on new data center infrastructure for powering online AI services. Staffers also began investigating how AI could come to Apple Music and the company’s office-productivity apps.

Apple found that its AI is capable enough to power features like voice memo transcriptions and photo editing, as well as new search capabilities in the Safari web browser and auto replies in apps like Messages. But it determined early on that OpenAI and Google were far ahead in chatbots and on-the-fly assistance.

Yeah, all of this makes sense and why Apple's initial foray into AI itself will likely be seen by some as "boring". But it's also likely the right call as outsourcing the more "exciting" generative AI elements to OpenAI (and perhaps others to come) gives Apple a credible answer for certain features that both end-users and Wall Street will be interested in while at the same time not overcommitting to technology that is both still very nascent and in some ways, perhaps fleeting. Oh yes, and they can pass the buck on any brand concerns around hallucinations.

OpenAI, meanwhile, will get the gigantic exposure that comes with being deeply integrated into some of the world’s best-selling smartphones and tablets. Still, Apple’s involvement may bring new scrutiny to the safety and privacy concerns swirling around ChatGPT. Depending on how deeply Apple plans to integrate the chatbot with its software, it also could mean that OpenAI has access to personal information, which could unnerve some users.

But Apple is expected to offer its new AI features as an opt-in service, according to the people familiar with the matter. So wary customers could easily steer clear of them if they’d prefer.

This also makes sense. Though the key will be in how they productize/message this. Presumably, Apple will have its own in-house AI (both on-device and in-cloud) doing a lot of the common and simple tasks – again, the "boring" stuff.1 But if you, say, try to have Siri read you a limerick of your own design, does she call up OpenAI? And is this a one-time disclaimer? Presumably every time would be too much (though would ensure brand safety to a greater extent), but perhaps it's like other notifications where it asks you to re-opt-in every so often? Is the opt-in verbal? A popup? Is the end result using OpenAI tech also denoted and disclaimed in some way? This can all get messy, quickly if Apple is overly-cautious.

But the main question, of course, is where the data actually goes? Is this sent to ChatGPT running on Microsoft's servers? Has Apple figured out a way to route (and anonymize) the data through their own servers first? Presumably they won't be able to run ChatGPT on their own servers, right? Right?! Is Microsoft just annoyed because the OpenAI deal will help Apple cut-the-line in having a consumer AI narrative? Or is it something more?

One more thing:

Regardless, the OpenAI agreement is likely a stopgap measure. Apple has a long history of eventually bringing outside technology in-house, such as when it replaced Intel Corp. chips with its own silicon.

Apple also is looking beyond chatbots. It aims to use large language models — a key technology behind generative AI — to help power a pair of robotic devices that it is secretly developing, the people said.

That includes a table-top robotic arm with a large, iPad-like display. The company also has been working on a mobile robot that can follow users around and handle chores on their behalf. And it’s looking to equip its AirPods with cameras and AI features.

"Rosey!" "Coming sir..."

1 For now...