Apple Strikes Deal with Google to Integrate Google Gemini AI Model into Apple's AI System

Bloomberg's editor Mark Gurman revealed in his latest Power On newsletter that Apple has reached at least one agreement with Google. This deal involves integrating the Google Gemini artificial intelligence model into Apple's AI system, enabling users to access these AI services on iPhones, iPads, and Macs.

Following the conclusion of the WWDC 2024 developer conference, Apple executives disclosed in interviews their decision to choose OpenAI aimed at directly opting for the best from the start. However, OpenAI was not the only focus, as Apple was also in discussions with other AI developers.

Among those Apple discussed with was Google, though multiple sources indicated that Apple and Google had not yet finalized an agreement. It was uncertain whether a deal could be reached in time for the official launch of Apple's intelligent AI system in the fall to the end of the year.

According to information obtained by Mark Gurman from sources, Apple has now at least reached a significant agreement with Google, namely, integrating Google Gemini into its AI system.

As per earlier rumors, Apple would not offer any payment to AI companies. Instead, Apple would leverage its vast ecosystem to promote these AI companies' products and attract users to sign up for paid subscriptions. Of course, Apple would continue to take a 30% cut from subscriptions made through the App Store.

Interestingly, Gurman also mentioned that the initial offering of Apple Intelligence might be free, but Apple could eventually introduce Apple Intelligence+ — a premium subscription service similar to iCloud+. Users seeking advanced features would need to subscribe, paying a monthly fee to Apple for access.

This strategy would allow Apple to generate additional revenue through new AI functionalities within its ecosystem, potentially making AI-related income a significant revenue stream alongside hardware sales, thereby becoming one of Apple's main sources of revenue in the future.