Hello, Reader.
You can’t spell Apple Inc. (AAPL) without AI.
At the company’s Worldwide Developers Conference (WWDC) event this week, the tech giant’s core announcement (pun intended) was its highly anticipated AI system, Apple Intelligence.
The system, according to Apple, will build generative AI “into your iPhone, iPad, and Mac to help you write, express yourself, and get things done effortlessly.”
Investors were ripe with excitement. Following the announcement, Apple surged on Wednesday to briefly become the world’s most valuable company, overtaking Microsoft Inc. (MSFT)… and did so again on Thursday (though MSFT is back to No. 1 as of this writing).
The company is now what I like to call an AI distributor… and a major one at that.
That said… though it has a homefield advantage in iPhones and other iOS devices, Apple Intelligence won’t likely be too disruptive to competitors like Gemini from Alphabet Inc. (GOOGL) or Meta AI from Meta Platforms Inc. (META).
So, in today’s Smart Money, let’s bite into what Apple Intelligence has to offer.
And I’ll share what Apple’s AI moves could mean for the rest of the tech sector… and what that means for your investments.
Let’s jump in…
Apple Intelligence Unveiled
Apple Intelligence is bringing a world of change to Apple’s products.
The most noticeable change will be an enhanced Siri experience. Apple promises its original voice assistant will feel more natural and responsive, addressing a long-standing challenge for the company.
Siri will now exhibit more onscreen awareness. For example, when asked, it will present a user with a specific photo that they’re looking for – and even move it to third-party apps if desired. Siri can also more easily check real-time flight tracking data and determine the optimal time to get going. Additionally, the voice assistant will be more context-aware, capable of answering questions about various features and settings.
Apple isn’t making these improvements alone. Through a partnership with OpenAI, users can now pose questions to ChatGPT through Siri, rather than relying solely on Apple’s own models. Apple is not paying OpenAI for the use of ChatGPT… but is providing Sam Altman’s company access to millions of new users.
This is not Apple’s first AI partnership. One of the company’s earliest forays into AI was with Unity Software Inc. (U) to create apps for Vision Pro, the virtual reality headset that made its debut earlier this year. While not yet the usual Apple blockbuster success, Vision Pro introduced “spatial computing,” which uses artificial intelligence as a critical building block – and has applications far beyond the world of gaming.
We’ll stay tuned to see if Apple can get consumers to buy their VR headset.
Also in the future, Apple will likely partner with Google’s Gemini AI model, based on comments about support for additional AI models. Google has a strong foundation in AI, with a range of popular apps and services that provide a wealth of data to power its AI capabilities. So, this partnership could offer huge AI opportunities to both companies.
What This Means for the Tech Sector
Beyond Siri, Apple Intelligence also powers Apple Rewrite, a new writing tool that can improve a user’s writing, produce summaries, create outlines… and impact competitors.
While Apple isn’t positioning itself in direct competition with major AI distributors like Microsoft, Alphabet,and Meta– yet –AI writing companies like Grammarly should be worried.
With Apple’s service officially entering Grammarly’s territory, they may end up going head to head. Some factors still favor Grammarly, especially the fact that Rewrite is only available on iOS devices. But smaller AI players will undoubtedly face challenges in keeping up with the likes of Apple as they forge ahead in the AI race.
Regards,
Eric Fry
P.S. As the leaders of the first phase of the AI boom are preparing to pass the baton to the leaders of the next, the world’s wealthiest are getting ready for what’s being dubbed “The Great Cash-Out.”
You don’t want to be caught unprepared. Check out this video from me for all the details.
Regards,
Eric Fry
