AI

AI feature makes Apple more valuable than ever, bigger than Nvidia

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© Apple
Startup Interviewer: Gib uns dein erstes AI Interview Startup Interviewer: Gib uns dein erstes AI Interview

After the presentation of Apple Intelligence for its own AI models and the confirmation that ChatGPT will be integrated into future software, the price of Apple shares has risen to a new all-time high.

With a price of up to $207 per share, Apple’s valuation has climbed to almost $3.2 trillion. This means that the iPhone company is worth more than ever before and is finally more valuable than chip manufacturer Nvidia, which recently snatched second place from Apple due to the AI ​​hype. With a valuation of just over $3.2 trillion, Microsoft is not far behind Apple.

This means that Apple has regained the ground it lost last year. The ranking of the largest companies in the world now looks like this:

Technically a little behind, but strategically way ahead

Although Apple seemed to have fallen behind Microsoft, Meta, and Google in terms of AI, the team around CEO Tim Cook seems to have done a lot right. Although the in-house AI models are not yet as powerful as the top models from OpenAI (GPT-4o) and Google (Gemini 1.5 Pro), they still come close to many of the best LLMs that are otherwise available on the market. And above all: They can run directly on iPhones, iPads, and Macs without requiring huge computing capacity in the cloud including data transfer – an important plus in terms of privacy.

Here are some points why Apple may be a technical laggard in LLMs, but has done a lot right with its AI strategy:

  1. Apple remains competitive with Android, especially since Google’s Gemini will play an important role. The functionality of iOS and Android is always compared, and Apple is now catching up again
  2. Users will have easier access to the most popular app of 2023, which will allow Apple to additionally benefit from paid ChatGPT Plus subscriptions as Apple will receive a share of app subscriptions.
  3. Potential errors and hallucinations of the AI ​​models can be blamed on OpenAI (or later Google). This preserves Apple’s image as a perfectionist and clean company in case AI models produce false statements or historical errors.
  4. Apple is buying time: It can reassure users and investors about AI while working on its own AI models. Once these are more mature, they can be more deeply integrated and better positioned than ChatGPT and Co.
  5. Microsoft is weakened by Apple giving the leading AI company another big platform. This could make Microsoft’s Copilot less attractive if GPT-4o is built directly into iPhone and other Apple devices.
  6. Apple lures Google: Since Google pays Apple $20 billion annually for its position as the default search engine on iPhones and Co. and is very afraid of ChatGPT, Google now has to bring Gemini to the iPhone, which could benefit Apple financially.
  7. Apple can point to data protection: Users who do not necessarily need ChatGPT can use the on-device LLMs.
  8. Upselling to more expensive hardware: Using the AI ​​features requires at least an iPhone 15 Pro, iPhone 15 Pro Max, or newer devices with an M1 chip. This gives consumers a good reason to upgrade to newer hardware after there have been a few reasons to do so in recent years.

WWDC 2024: Apple will integrate ChatGPT into iPhones, iPads and Macs starting this fall

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