Apple is reportedly planning a significant investment in OpenAI, a move that could value the ChatGPT developer at $100 billion. This fundraising round, also involving Nvidia and Microsoft, signals Apple’s increasing focus on artificial intelligence. Although historically quieter about its AI pursuits, Apple has been steadily strengthening its position through strategic acquisitions and partnerships.
Apple has maintained a different approach to AI compared to other tech giants. While competitors like Google and Microsoft openly discuss their AI advancements, Apple has kept a lower profile. However, the company has been investing in AI-related startups, acquiring 21 such companies between 2017 and 2023, more than any of its peers.
Strategic Partnerships and Acquisitions
During its Worldwide Developers Conference in June, CEO Tim Cook introduced Apple Intelligence, Apple’s first suite of AI offerings. This announcement included a partnership with OpenAI, aimed at integrating ChatGPT into various Apple products. Moreover, while Apple almost took a nonvoting seat on OpenAI’s board, both Apple and Microsoft withdrew to avoid antitrust concerns.
Apple’s notable acquisitions in the AI space include WaveOne for video compression, AI Music for music generation, and more recently, DarwinAI and Datakalab. These strategic moves highlight Apple’s commitment to enhancing its AI capabilities, despite its traditionally understated approach.
Unique Investment Strategy
Apple has made relatively few startup investments since its founding in 1974. Out of 30 investments over the decades, only three were directly AI-related. These include a $2.5 million investment in Adobe in 1984, and funding rounds in 2016 for Volley and Chinese ride-hailing giant DiDi. This selective investment strategy underscores Apple’s cautious yet deliberate shift towards AI.
Apple’s investment in OpenAI marks a significant step in its AI journey. Historically, Apple has preferred to deploy technologies only when they are market-ready, a strategy that Tim Cook emphasized in an earnings call. “We tend to announce things as they come to market. That’s our M.O. and I’d like to stick to that,” Cook asserted.
Apple’s increasing focus on AI demonstrates its desire to stay competitive in a rapidly evolving technological landscape. By investing in and acquiring AI startups, Apple aims to enhance its product offerings and maintain its market position. This strategic shift suggests that Apple is gearing up to play a more prominent role in the AI sector, aligning its traditionally secretive approach with a growing investment portfolio.
