Alphabet declined to respond to a question from one of its investors who invested in the Google-Apple AI deal at Wednesday’s fourth-quarter earnings call. Instead of answering an analyst’s question about how the tech giant thinks about AI partnerships like the one with Apple that powers the AI for Siri, the question was completely ignored.
However, the decision tells us something – Alphabet is not ready to talk about how this partnership will affect its core business, which is increasingly focused on AI.
Over the years, the relationship between Google and Apple has been mutually beneficial. The two companies’ search partnership saw the search giant pay the iPhone maker $20 billion for the default search engine on Apple devices, filings from a Justice Department lawsuit against the search giant revealed. In return, Google gained access to Apple’s vast customer base — the iPhone maker announced last quarter that it had 2.5 billion active devices worldwide, to give you an idea of the scale.
Apple’s latest AI deal is said to cost Apple roughly $1 billion a year, but the payoff for Google isn’t as immediately obvious as it is for search. On Google Search, consumers see links to advertisers’ websites at the top of search results. AI-mode ads, which could one day be the future of Google search, are still an “experiment” for now.
The company first announced last May that it would bring ads to AI mode, a chatbot-style interface for Google Search, but these tests see ads placed below or integrated into chatbot responses. Google is also experimenting with agent-based shopping, including a Shop with AI mode to guide consumers with product inquiries to a seamless checkout from an AI interface.
Google’s AI competitor Anthropic, meanwhile, is targeting ad-supported AI with its upcoming Super Bowl ad that challenges the business model adopted by ChatGPT makers OpenAI and Google.
How this will all play out in the long run is still an open question – and one that seems unanswered for today.
All in all, Apple’s Siri deal barely got a mention during Alphabet’s earnings call on Wednesday. Pichai only noted that he was pleased to be Apple’s “preferred cloud provider” and help develop “the next generation of Apple flagships based on Gemini technology.” Google’s Chief Commercial Officer Philipp Schindler used exactly the same wording when he mentioned Apple.