Goodbye Google Gemini? Apple In Talks With Microsoft-Backed OpenAI For iPhone AI Features: Report

Apple Inc. AAPL has reportedly resumed discussions with Microsoft Corp.-backed MSFT OpenAI about incorporating the startup’s AI technology into the upcoming iPhone features.

What Happened: Apple is in talks with OpenAI to potentially integrate its technology into the iPhone’s next operating system, iOS 18, Bloomberg reported.

The companies are discussing the terms of the agreement and how OpenAI’s features would be integrated into iOS 18.

This development marks the reopening of discussions between the two companies. While Apple had initially collaborated with OpenAI earlier this year, there has been minimal engagement between the two entities since then.

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Apple has not yet made a final decision on its partners and there is no guarantee that a deal will be reached. The company may ultimately strike a deal with both OpenAI and Google or choose another provider altogether.

Apple and OpenAI did not immediately respond to Benzinga's request for comment.

See Also: Mark Zuckerberg Shades Apple Vision Pro Once Again, Calls It ‘Fashionable AI Glasses Without A Display’

The iOS 18 update is set to include several new features based on Apple’s in-house large language model AI model. The company is also seeking partners to power a chatbot-like feature similar to OpenAI’s ChatGPT.

Why It Matters: The renewed talks between Apple and OpenAI come amidst Apple’s ongoing discussions with Alphabet Inc.‘s GOOG GOOGL Google about licensing the latter’s Gemini AI models for future iPhones. The potential deal with OpenAI and Google could also significantly impact the iPhone’s AI capabilities.

Apple’s CEO, Tim Cook, has been vocal about the company’s plans to introduce new AI features on a “very thoughtful basis.” By collaborating with external partners like OpenAI and Google, Apple aims to accelerate its AI push and enhance its devices’ AI capabilities while mitigating potential risks.

Price Action: Apple's shares closed 0.35% lower at $169.30 on Friday, according to Benzinga Pro.

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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.

Photo by Thai Nguyen on Unsplash