Apple Loses AI Race: The Real Challenge Begins

Apple’s recent developments suggest that while the company faced setbacks in the AI arena, it continues to dominate the smartphone market. Despite initial struggles with the rollout of Apple Intelligence, the company has made strategic decisions to enhance its Siri platform using Google’s Gemini models.

Apple’s AI Challenges and Market Performance

In 2024, Apple faced a rocky start with its AI initiative. The iPhone 16 was introduced as “Built for Apple Intelligence,” yet it shipped without the promised features. Over the next few months, delays occurred, and Apple executives acknowledged the need for redesigning their approach. Despite these issues, consumer loyalty to Apple remains strong.

• According to IDC’s Q3 2025 report, pre-orders for the iPhone 17 exceeded those of its predecessor.
• Counterpoint Research identified Apple as the global smartphone market leader in 2025, showing a year-over-year growth of 10% in market share.

Interestingly, Apple Intelligence played a lesser role in the marketing of the iPhone 17 compared to its predecessor. The focus on AI has become critical, as investors increasingly expect tech companies to showcase their AI strategies.

New Partnerships and Future Directions

As Apple pivots forward, it appears to be exploring partnerships with external AI developers rather than building its own models entirely. This strategy is not without precedent; Apple has allowed users to access ChatGPT in iOS and is committed to integrating more third-party language models. Recent reports indicate a deal to leverage Google’s AI capabilities to create a more advanced Siri, which will operate within Apple’s Private Cloud Compute.

Evaluating Apple’s AI Strategy

While this shift may seem beneficial from a business perspective, it raises questions about Apple’s long-term approach to AI technology. Historically, Apple has aimed to control key technologies, as evidenced by its development of proprietary silicon. The company’s reliance on Google’s models for Siri might signal a departure from this philosophy, posing a risk of falling behind in a rapidly evolving tech landscape.

• Tim Cook’s statement in a 2009 earnings call emphasized the importance of owning core technologies.
• The effectiveness of Apple’s AI initiative depends on creating a product that resonates with users, moving beyond its current functionalities.

Apple must transform Siri into a genuinely useful tool rather than a basic assistant. The challenge ahead lies in aligning its AI capabilities with consumer expectations while maintaining a competitive edge against rivals like Google. The partnership may be formalized, but significant work remains to ensure Apple Intelligence evolves into a desirable product.

In conclusion, Apple’s journey in the AI race is far from over. The upcoming developments around Siri and the company’s strategy to integrate advanced AI features will determine their future success.