No one wants unfinished AI on the iPhone (except investors)

Lately, I’ve been seeing headlines like this from the long-running tech news site CNET: “Will Siri become more like ChatGPT?”

If you’re an iPhone user, I bet your instinctive answer to that question is: “I sure hope not.” Or maybe: “I don’t care — I don’t use Siri anyway.” Both are reasonable responses. The iPhone is too important to our daily lives to be bogged down with experimental AI that is as likely to hallucinate as it is to help.

Regardless, the question is still being asked because next week is Apple’s annual Worldwide Developer Conference (WWDC), a forum where CEO Tim Cook is widely expected to detail about his company’s most important moves in artificial intelligence to date.

This won’t say much. The company is considered so far behind its peers that, if reports are accurate, getting Apple up to speed will require some form of partnership with OpenAI, or perhaps Google, to Get advanced functionality on iPhone in some shape or form.

The desire to do all this comes less from users and more from Wall Street. With Apple’s stock price falling so far this year compared to those of its tech rivals, investors hope Apple can turn things around by offering a grand vision of AI that The company has kept it hidden (or absent) until now. According to analysts at Wedbush Securities, “the AI-driven iPhone 16 super cycle is now emerging,” while calling WWDC Apple’s most important event in a decade.

Now, Wedbush is one of the more excitable tech observers on Wall Street. However, the widespread level of expectation is palpable. Investors hope AI can give consumers a reason to upgrade their smartphones sooner than they might have otherwise – an antidote to falling iPhone sales.

The leader, as CNET’s headline suggests, is the hapless Siri. According to Bloomberg’s Mark Gurman, voice assistants, which have long been a great idea that needed better execution, are getting an “overhaul” in a move that will allow users to control individual app functions using their voice.

Would a smarter Siri make people rush to buy a new iPhone? I wouldn’t believe it. According to a recent Bloomberg Intelligence poll, only 7% of 568 US respondents said AI features were a deciding factor in their next device. Longstanding headaches such as battery life (45%) and price (40%) are still the most important issues. The same survey indicates that consumers are using their phones longer than ever thanks to “inflation and high product quality.” On the plus side for Apple, when current iPhone owners decide to upgrade, the majority of them stay with the company — 94%, according to BI.

All this means Apple is “in no rush” to bring AI features to users, Creative Strategies technology analyst Carolina Milanesi said. In fact, it may do more harm than good. A company built on “it just works” and promises of privacy may find that current AI applications are going against both pillars of their hard-earned reputation. AI is often buggy, slow, and for more complex queries, it requires sending data off to do the heavy lifting in the cloud. “Apple may have discovered that they are behind the market,” agrees Ben Wood, analyst at CCS Insight. “But they don’t need to have an immediate reaction.”

A knee-jerk reaction would risk looking a lot like Meta Platforms Inc.’s AI bot, clumsily crammed into apps like WhatsApp and Messenger and described by many as annoying. Or it could end up like Google’s AI Overview, which was reinstated just a week after generating what Google described as “odd and flawed” results for search queries.

The launch of these products was at least partly driven by the need to keep Wall Street happy, helping to justify the heavy spending on new infrastructure. Google employees I spoke to recently spoke of a culture of near panic as the company fears its search dominance is threatened by AI.

Cooler heads must prevail at Apple, where such threats are not a concern – at least not for any short-term period. The iPhone is the competitive moat to end all moats, the “Hotel California” of tech products, Wood joked (antitrust regulators find that less funny). Users will not be in a hurry to abandon their long-time loyalty to AI. What Google and Samsung are offering so far is not transformative enough to warrant this effort.

So Apple has plenty of time and they don’t need to fall into the trap of launching half-baked ideas to protect their position. Instead, its priority must be to carefully and incrementally update AI to enhance existing features and use cases. There is no doubt that the potential of AI on Apple products is huge. With a touch of flair, Apple could become the most important AI company in the world, bringing innovation to the masses like they did with smartphones. Investors should not push the company just for a quick win.


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