Alphabet won’t talk about the Google-Apple AI deal, even to investors

Alphabet declined to answer one of its investors during questions about Google’s artificial intelligence deal with Apple on its fourth-quarter earnings call on Wednesday. Instead of answering an analyst’s question about how the tech giant thinks about AI partnerships, such as partnering with Apple to power Siri’s AI, the question was completely ignored.

This decision tells us something: Alphabet is not ready to talk about how this partnership will impact its core business, which is increasingly focused on artificial intelligence.

Over the years, the relationship between Google and Apple has been mutually beneficial. The search partnership between the two companies saw the search giant pay the iPhone maker $20 billion to be the default search engine on Apple devices, filings in the Justice Department’s lawsuit against the search giant have revealed. In return, Google has access to Apple’s massive 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 rumored to cost Apple roughly $1 billion a year, but the payoff beyond that for Google isn’t immediately clear as it is with search. In Google search, consumers see links to advertisers’ websites at the top of the search results. AI-placed ads, which could one day represent the future of Google’s search business, are still an “experiment” for now.

The company first announced last May that it would bring ads into AI Mode, a chatbot-style interface for Google Search, but these tests see ads placed below or embedded in chatbot responses. Google is also trying out a proxy shopping experience, including an AI shopping mode, to direct consumers with product-related queries to a seamless checkout experience from the AI ​​interface.

Meanwhile, Google’s AI rival Anthropic is targeting ad-supported AI with an upcoming Super Bowl ad, which challenges the business model embraced by OpenAI, the maker of ChatGPT, and Google.

How all this will develop in the long term remains an open question – and, even today, an unanswered question, it seems.

Overall, the Apple Siri deal barely received any mention during Alphabet’s earnings call on Wednesday. Sundar Pichai noted only that he is pleased that Apple is the “cloud provider of choice” and will help develop “the next generation of Apple enterprise models based on Gemini technology.” Philip Schindler, Google’s chief business officer, used the exact same wording when mentioning Apple as well.