Apple is expected to assert next week that it is not lagging behind as tech rivals leapfrog into artificial intelligence.
AI, and Apple's partnership with ChatGPT developer OpenAI, are likely to be major themes at Apple's annual WWDC developers conference in Silicon Valley on Monday, analysts said.
The conference is an annual gathering of developers building apps and software for Apple's ecosystem, and Chief Executive Officer Tim Cook will try to convince them that the company is a major player in AI at a time when rivals Microsoft and Google are rolling out rapid-fire innovations.
Apple has been quietly building AI features into its iPhones, iPads and Mac computers for years, but it has yet to solidify its overall strategy or adopt the ChatGPT-style generative AI that took the world by storm in late 2022.
Apple's shares have been on a rollercoaster ride since sparking the AI revolution, but the company's Wall Street followers see next week's announcement as the start of a new chapter for the iPhone maker.
“WWDC is Apple's most important event in a decade with the pressure to create an AI tech stack for developers and consumers at the forefront,” Daniel Ives, senior analyst at Wedbush Equities, told AFP.
Ives said the centerpiece of the announcement will almost certainly be an update to Apple's iPhone operating system, with AI expected to play a central role.
He also predicted a “flagship” OpenAI partnership that would include an exclusive chatbot, which could be part of an upgrade to the much-derided virtual assistant Siri.
Because Apple makes most of its money selling iPhones and other hardware, its AI integration is likely to be focused on making its devices and services work more seamlessly together, said Carolina Milanesi, an analyst at Creative Strategies.
“At the end of the day, what's important to Apple is getting people to upgrade their iPhones,” Milanesi said.
“Let's see if Apple gives them a compelling reason to do so.”
– 'Litmus test' –
To compete with MacBook laptops, Apple rival Microsoft has “thrown down the gauntlet” by injecting generative AI capabilities into Windows-based computers, according to Techsponential analyst Avi Greengart.
“Timing is crucial for Apple,” said Gadjo Sevilla, senior analyst at eMarketer.
The WWDC announcement will be a “litmus test” of whether Apple can integrate generative AI like ChatGPT into all of its devices and services, he said.
“Any mistake Apple makes at this point would cost the company its status as a technology leader, especially since it's now sandwiched between two AI giants with actual products and release roadmaps spanning the next two years.”
Earlier this year, Apple lost its title as the world's most valuable company by market capitalization to Microsoft, with AI chip leader Nvidia rapidly catching up.
Cook and his team have already signaled their intention to meet the AI challenge by equipping the recently released iPads and MacBooks with more powerful, AI-enabled chips.
But analysts say a big challenge for Apple is how to incorporate the technology into its products without undermining the company's focus on user privacy and security.
ChatGPT-style AI will devour data voraciously, so Apple will have a hard time fighting the AI race while upholding its traditional position on protecting data privacy.
“If Apple over-controls the AI ecosystem, it could lose ground or fall behind while other companies move quickly and innovate,” Sevilla said.
Now Apple has little choice but to join the fray.
Market research firm Canalys predicts that 16% of smartphones shipped globally this year will be AI-enabled, rising to 54% by 2028.
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