Apple is saving a ridiculous amount of money by just licensing Gemini from Google instead of trying to keep up with a frontier model of their own. In a few years when the S-curve has flattened a bit it will probably be way cheaper to catch up if Google then tries to squeeze them.
They're not really in that business, though, so who cares? It's like saying Apple is eating the other guys' lunch on Swift adoption. Or Microsoft is eating their lunch on Video Games. There's no rule that says "All companies must focus on AI."
Fun fact: selling iPhones and my TV+ subscription I forgot to cancel and don’t even use is a lot more profitable than selling $2 of compute time for $1 (with 0-6 months of moat).
That's the case for now, but I get this feeling that in 3 years we're all likely to just be running local models on Apple Silicon and they're gonna be having the last laugh.
Apple is saving a ridiculous amount of money by just licensing Gemini from Google instead of trying to keep up with a frontier model of their own. In a few years when the S-curve has flattened a bit it will probably be way cheaper to catch up if Google then tries to squeeze them.
They're not really in that business, though, so who cares? It's like saying Apple is eating the other guys' lunch on Swift adoption. Or Microsoft is eating their lunch on Video Games. There's no rule that says "All companies must focus on AI."
Fun fact: selling iPhones and my TV+ subscription I forgot to cancel and don’t even use is a lot more profitable than selling $2 of compute time for $1 (with 0-6 months of moat).
That they aren’t participating in the AI arms race is very good for current earning
That's the case for now, but I get this feeling that in 3 years we're all likely to just be running local models on Apple Silicon and they're gonna be having the last laugh.