21–30 of 87 posts
Apple was being pressured by Wall Street to make move here, so you'd think they'd have the weak hand. However, by the time they moved, there were 3-4 vendors Apple could play off each other.
Which 3-4 vendors?
Okay. Still curious if Apple "at least" has to pay the cloud-compute for the "free" OpenAI services they use (with OpenAI just licensing them their product for free) or if Apple really gets free AI-features AND 30% RevShare from handling sales of Premium OpenAI accounts... I can't imagine that the profit of sold Premium subscriptions for OpenAI is sufficient to pay for the infrastructure hundreds of million iPhone us…
a) Microsoft pays for compute. OpenAI never intended to run their own cloud.
b) Apple's 15%/30% is a "cost of channel" for developers. It is the fee they pay to get free users delivered to their app. And the decision to do this is purely a business one that can be changed at will and does not apply at all to this situation.
c) Calling Apple a gatekeeper for implementing additional features to their OS is odd to the say the least. They have made it clear during the keynote/WWDC presentations that they plan to add additional providers than OpenAI.
Okay. Still curious if Apple "at least" has to pay the cloud-compute for the "free" OpenAI services they use (with OpenAI just licensing them their product for free) or if Apple really gets free AI-features AND 30% RevShare from handling sales of Premium OpenAI accounts... I can't imagine that the profit of sold Premium subscriptions for OpenAI is sufficient to pay for the infrastructure hundreds of million iPhone us…
Sam has gotten OpenAI well capitalized, and is playing a bit of a ponzi game. The big moves he has made are almost certainly not sustainable, and he's betting the farm that OpenAI can snowball into a monopoly position, bring costs way down and take over the world before investors start giving him the cold shoulder. OpenAI is far ahead of pretty much everyone but Meta in the race, but in the long run I think Mark and…
Earlier quoted context omitted.
Satya Nadella subsidizing Apple AI. Did not see that one coming....
Microsoft and Apple have had a great relationship for decades. And Satya would love nothing more than to drive Apple and Google apart.
It's possible that Apple sees it as a future app store-like revenue. You can use any AI model you want, and if you want to subscribe to Gemini Pro or ChatGPT Plus, Apple takes 30%.
I was certain that Apple wants to create their own cutting edge LLM to compete with GPT4 or Gemini or Claude or Mixtral. But they've decided to instead, open up all their platforms to 3rd party models.
I suppose Apple may still want to create an Apple Intelligence Pro in the future but their models aren't leading at the moment.
Earlier quoted context omitted.
Sure, but they're not all en_US. I've got three on my desk right now*, and I'm in Germany. * got one of my own right before a previous employer closed down and let us keep the work one, third one is from new employer
Apple Intelligence won't be limited to en_US right? It should be available world wide.
Apple was being pressured by Wall Street to make move here, so you'd think they'd have the weak hand. However, by the time they moved, there were 3-4 vendors Apple could play off each other.
> there were 3-4 vendors Apple could play off each other. Which 3-4 vendors?
In conversation with reporters after the WWDC keynote, Apple's senior VP of software engineering Craig Federighi revealed that as Apple Intelligence evolves, the company eventually wants to give its users a choice between different AI models, and suggested that Google Gemini could be an option in the future.
"We think ultimately people are going to have a preference for certain models they want to use, maybe one that's great for creative writing or one that they prefer for coding," said Federighi. "Maybe Google Gemini in the future. I mean, nothing to announce right now, but that's our direction."
I suppose they will do the app-store financial model. They take 30% cut.
Some possible vendors: Google Gemini, Anthroic Claude, Mixtral, and other Chinese vendors in China market.
Earlier quoted context omitted.
Not billion(s), because Apple Intelligence will only work on Apple Silicon (Mx) Mac and iPad and iPhone 15 Pro. Also, initially only in en_US devices. I’ve heard 100 mi figure, but can’t confirm/remember where.
Do Siri queries not fall back to GPT4o in older devices? That seems weird because the inference is done in the cloud. But 100m figure seems small. There are ~100m Apple Silicon Macs sold in the last 4 years. That's not including any M1+ iPads or iPhone 15 Pros. I'm guessing maybe 250m? Still a ton of queries and usage. It's not just Siri. I believe features like optimize email response also uses GPT4o.
I think the Apple server inference is handling things like image generation where you need a beefy guy to get results quickly, and don’t need to transmit as much user context to service the request.
It sort of makes sense but can be risky for OpenAI. I suspect that there are limits to this deal. For example, Apple will pay x amount if conversion rate is lower than x. You're adding a few billion devices to do inference for if you're OpenAI without knowing the conversion rate from free to paid ChatGPT accounts from Apple users. Also, can OpenAI really handle that much more traffic? Sometimes my paid ChatGPT accoun…
> Also, can OpenAI really handle that much more traffic Microsoft Azure is handling the traffic. And Apple would never enter into such a deal without proper capacity planning.
Okay. Still curious if Apple "at least" has to pay the cloud-compute for the "free" OpenAI services they use (with OpenAI just licensing them their product for free) or if Apple really gets free AI-features AND 30% RevShare from handling sales of Premium OpenAI accounts... I can't imagine that the profit of sold Premium subscriptions for OpenAI is sufficient to pay for the infrastructure hundreds of million iPhone us…
None of this makes any sense. a) Microsoft pays for compute. OpenAI never intended to run their own cloud. b) Apple's 15%/30% is a "cost of channel" for developers. It is the fee they pay to get free users delivered to their app. And the decision to do this is purely a business one that can be changed at will and does not apply at all to this situation. c) Calling Apple a gatekeeper for implementing additional featur…
No, Microsoft INVESTED in OpenAI and in exchange became OpenAI's exclusive cloud provider. That doesn't mean they pay for the compute of all customers.
> b) Apple's 15%/30% is a "cost of channel" for developers. It is the fee they pay to get free users delivered to their app. And the decision to do this is purely a business one that can be changed at will and does not apply at all to this situation.
Not sure what you meant to say here. Purchasing of OpenAI "premium" would be handled via Apple's payment platform, for which Apple will likely take a cut. Regardless, OpenAI's gamble would be to onboard ~100M iPhone users under a "free" tier in a single rollout step, in hopes that the conversion-rate to an OpenAI premium will be high enough to offset the (infrastructure!) cost of serving all those users for free
> c) Calling Apple a gatekeeper for implementing additional features to their OS is odd to the say the least. They have made it clear during the keynote/WWDC presentations that they plan to add additional providers than OpenAI.
Apple is the gatekeeper because they are in control of the decision to offload AI-tasks to a 3rd party service or do them "in-house" (on-device/Apple-cloud), This doesn't change regardless whether they stated this upfront at the keynote/WWDC or not.
Because of this structure, Apple is are aware of every single AI-task that is to be done and will use this information to influence their in-house roadmap (a natural decision, because on-device is better than cloud, and Apple-cloud is better because ).
At some point in the future, the user will be able to select WHICH 3rd party he wants to use, but so far I don't see any indication that Apple considers themselves as a 3rd party.
And even if they would, they hold more information than all other providers because they FIRST decide whether a task can be handled on-device or not.
Earlier quoted context omitted.
There are three models: 1. Apple On-Device 2. Apple Server 3. GPT-4o Apple Silicon/Mx, iPad, iPhone 15 Pro can access all three. All other devices can still access Apple Server and GPT-4o. So, I'd expect the incompatible devices to actually hammer OpenAI more .
Other devices are not getting Apple Intelligence.