Unpacking Apple’s AI reveal

Yesterday, at its annual Worldwide Developers Conference, Apple, with the panache of a chef unveiling a slow-cooked proprietary dish, revealed its long-awaited generative AI strategy – a software update called Apple Intelligence.

The overarching idea: Apple is opting not to focus on developing broad artificial intelligence models – outsourcing the massive costs and potential for liabilities to companies like OpenAI and Google – and is instead focused on integrating specific AI features into its products that are useful for the end user (in other words: putting the “i” in “AI”).

Some of the features coming later this year to the iPhone 15 and any Macs/iPads running on the company’s M1 or M2 chip:

• Genmoji: Users will be able to use generative AI to create custom emojis to share – including ones that look just like their friends.
• Writing tools: Functionalities include rewriting existing copy, changing the tone of language, summarizing messages in “TLDR” format, and penning Smart Replies to messages.
• Image generation: Apple Intelligence can create generative photos in three styles – Sketch, Illustration, and Animation – based on a user’s photo library.
• Smart notifications: Devices will be able to prioritize notifications to bring up the most important notes while minimizing less relevant ones.

Siri is also getting an upgrade. Apple’s OG digital assistant will now be able to take action in and across apps, like sending a DONUT article from Apple News to a group thread in Messages😉. Third-party apps will also be able to tap into some of Siri’s enhancements.

Plus, as part of a partnership with OpenAI, Siri will be able to access ChatGPT when needed. Apple’s assistant in this case acts as a consigliare-style go-between, asking users if they want to share their question with ChatGPT and then returning suggestions from the OpenAI chatbot. ChatGPT is also built into the previously mentioned writing tools.

📸 Big picture: Up until now, Apple’s core product suite has lacked generative AI features – while competitors like Microsoft and Google have been full steam ahead integrating AI into their products. Apple stock, which over the past year has lagged behind other Big Tech rivals, closed down ~2% on the day.