For an AI loser, Apple scored a huge win last year.
The mess that went into the Apple Intelligence rollout was certainly embarrassing, but through it all, the company kept doing what it does best: selling iPhones. With this week’s news that it will use the Gemini model to power the long-awaited Smart Siri, it looks like Apple has won a big ‘ol’ L in the whole AI race. But there’s still a huge challenge ahead – and Apple isn’t out of the race yet.
Apple Intelligence has a well-documented debut in 2024. The iPhone 16 was “Built for Apple Intelligence”, but shipped without it. Features arrived over the next few months, but the so-called smarter Siri never materialized. Apple executives admitted that they had gone back to the drawing board, moved people around, and it all looked like a huge failure on Apple’s part.
But it doesn’t exactly seem like people are ready to give up their iPhones for Google’s Gemini-powered Android phones. according to IDC’s Q3 2025 report“Demand for Apple’s new iPhone 17 lineup was strong, with pre-orders higher than the previous generation.” Counterpoint Research calls Apple the global smartphone “market leader” in 2025 Market share growth of 10 percent year-on-year. Meanwhile, Apple Intelligence is much less prominent in the marketing of the iPhone 17 than it was for the 16; you have to Scroll halfway down the iPhone 17 product page Before you even get to the first mention.
The stalling strategy worked, but these days investors get nervous if you don’t mention AI every five minutes. Apple had to come along Some? as a strategy, and in the second half of 2025, we started hearing reports that it You may be considering external partnersInstead of creating your own models from scratch. This would not be completely unprecedented; Apple already lets users access ChatGPT directly in iOS and has promised from the beginning that it will add more third-party LLMs this way. But this week’s deal isn’t about adding a quick way to chat with Gemini on the iPhone. You can already do this in the Gemini app. It’s about building a smart Siri on Google’s model and running it in Apple’s private cloud compute. If a smarter Siri comes out this year, it’ll have some serious Gemini DNA.
You can argue that Apple made the right decision from a business perspective, but was it the right one? Apple step? Consider Tim Cook’s own words in the 2009 earnings call: “We believe we need to own and control the primary technologies behind the products we make…” That was the foundation of the company’s effort to develop its own silicon, which has certainly been a winning strategy. But either Apple thinks the AI model isn’t a primary technology — more like an underlying service it would build products on top of — or it has made a serious misjudgment about AI being the next platform shift and the risks of being left behind. Low stakes stuff!
That’s the challenge: turning Apple Intelligence into a product people actually want, not a product they feel indifferent about
And of course, Apple doesn’t control the destiny of every part of the iPhone. It hasn’t gone out and created a search engine, or its own wireless network, or an algorithmic social media platform. All those things run on the iPhone, but they’re not a core part of the iPhone’s identity, and AI could end up being the same way. This may be a sign that Apple has moved away from encouraging developers to adopt its own App Intents Framework Using anthropic-developed MCP as a basis for agentic characteristics. If the AI needs to find the right hook to get the job done, the particular model it’s running matters less. But it all depends on the product Apple builds around AI — and that starts with Siri.
This is the real challenge facing Apple: turning Apple Intelligence into a product people actually want, not a product they feel indifferent about. It needs to turn Siri into the thing the company has always promised it to be, not a glorified timer-setting machine. Apple can make a beautiful product – no doubt about it. Can he do this without control over his own models? Can it do things faster than Google or Jony Ive or any other competitor ready to run over garden walls? The deal may be done, but the real work begins now.
