Apple's missing mojo
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Apple's modest AI updates announced Monday did little to shake the sense that the iPhone maker is still finding its footing in AI as rivals charge ahead.
Why it matters: AI is widely seen as the largest technology shift in decades and could easily serve as an inflection point where existing leaders are dethroned and new ones crowned.
Driving the news: One year after unveiling an expansive vision for personalized AI that it has largely failed to deliver, the iPhone maker focused on a smaller set of tweaks and enhancements to Apple Intelligence at its WWDC conference.
- Some announcements from Monday, such as live translation, are useful additions already offered on rival devices from Google, Samsung and Microsoft.
- In a handful of other areas, such as image generation, Apple is improving its offering by drawing more heavily on its partnership with OpenAI.
- ChatGPT already handles Apple Intelligence features that require more world knowledge than is available from Apple's smaller, locally run models.
- Apple's most significant AI move was to allow developers to make use of Apple's own models, including a 3 billion-parameter model that runs on Apple devices and a larger one that runs via Apple's servers.
Yes, but: The list of things Apple left unsaid looms larger than the improvements it did announce.
- The company didn't expand — or even really elaborate — on the vision it laid out last year where Apple takes advantage of all that it knows about its individual users to answer questions in a privacy-friendly way.
- Nor did Apple announce rumored deals with Google or Perplexity to serve as additional third-party engines for Apple Intelligence.
- Most glaringly, the company didn't offer a concrete timeline for the improved Siri originally promised last year. Apple's Craig Federighi said only that Apple would have more to say about the delayed feature within the coming year.
The big picture: Apple's incrementalism stands in sharp contrast to Google, which unveiled a host of AI features, many of which were the kinds of things that users can touch and use, such as its new tools for video creation.
- Microsoft, Anthropic and others have also held events in recent weeks that offered more substantive advances for developers than what Apple showed on Monday.
- While Apple tends to avoid being at the bleeding edge of technology, its long-standing strategy of arriving late, but polished, might not survive the fast-moving pace of generative AI.
Between the lines: Apple appeared eager not to overpromise at this year's WWDC, announcing only features it expects to be part of the fall release.
- The restraint reflects the fear of repeating last year's disastrous hyping of AI features that slipped past their ship dates.
- However, by sharing only what it is ready to ship, Apple may have reinforced the perception that it has made little progress since last year.
What they're saying: Angelo Zino, a senior vice president and equity analyst at CFRA Research, said he remains positive on Apple for the long term but called Monday's developer conference a "dud" that is testing investors' patience.
- "In our view, monetization potential for AI is still on the table from both the services and hardware side, but we acknowledge that investors will need to be patient over the next six to nine months as the lack of AI innovation and other concerns linger," Zino wrote.
