Apple in talks to let Google’s Gemini power AI on iPhones

Apple is in talks to build Google’s Gemini artificial intelligence engine into the iPhone, according to people familiar with the situation, setting the stage for a blockbuster agreement that would shake up the AI industry.

The two companies are in active negotiations to let Apple license Gemini, Google’s set of generative AI models, to power some new features coming to the iPhone software this year, said the people, who asked not to be identified because the deliberations are private.Apple also recently held discussions with OpenAI and has considered using its model, according to the people.

If a deal between Apple and Google comes to fruition, it would build upon the two companies’ search partnership. For years, Google has paid Apple billions of dollars annually to make its search engine the default option in the Safari web browser on the iPhone. The two parties haven’t decided the terms or branding of an AI agreement or finalised how it would be implemented, the people said.

Alphabet shares rose as much as 7.4% on Monday as the markets opened in New York. It was the biggest intraday gain since Feb 2, 2023. Apple was up 2%.

A deal would give Gemini a key edge with billions of potential users. But it also may be a sign that Apple isn’t as far along with its AI efforts as some might have hoped — and threatens to draw further antitrust scrutiny of both companies.

Apple is preparing new capabilities as part of iOS 18 based on its own AI models. But those enhancements will be focused on features that operate on its devices, rather than ones delivered via the cloud. So Apple is seeking a partner to do the heavy lifting of gen AI, including functions for creating images and writing essays based on prompts.

Spokespeople for Apple and Google declined to comment. OpenAI didn’t immediately respond to a request for comment. Since early last year, Apple has been testing its own large language model — the technology behind gen AI — codenamed Ajax. But Apple’s technology remains inferior to tools from Google and other rivals, according to the people, making a partnership look like the better option.