Here’s why partnering with Anthropic or OpenAI might be Apple’s saving grace.
Transcript:
CAROLINE WOODS: We have Apple reportedly weighing using Anthropic or OpenAI to power Siri. What are your thoughts on that? Is that a mistake?
SHAY BOLOOR: I don’t think so because they’re so behind in AI. I think it’s tricky because Apple is the type of company that’s very hidden about what they’re actually working on behind the scenes. So a lot of finger in the air like where it’s blowing. But I think we got signs this week that they’re actually significantly behind on the internal foundational model, and they can’t afford to do. So when you see Meta’s Zuckerberg, he’s willing to bet $20 billion on a shadow hire on Alexandr Wang through Scale AI just to get him under the roof, spending $100 million signing bonuses for a superintelligence team. It’s vital for these hyperscalers to be a massive player in this race, because if they’re not, they’re missing out on the biggest movement in honestly, mankind’s history, which is AI. And I think that people are scoffing about Meta, for example, spending $100 million per FTE. But think about it. Back of the napkin math like there are $2 billion company if they miss this AI race, I think conservatively it’s going to be a 25% haircut. So that’s a $500 billion of risk spending a couple million on AI brain talent to come in-house to make sure they are maintaining their lead or competitive edge in this race is nothing. So Apple I mean, go back to your point on Apple. I don’t think AI talent wants to work there. I think they are working at AI, they’re working at Meta. So I think Apple doesn’t have the talent to create their internal financial model. So they have to partner up. And I think they’re the next derivative of Apple’s innovation isn’t going to be a Siri. It’s going to be humanoid robots. It makes too much sense. Like that’s the next hardware evolution in society. And everyone has I have an AirPods, I have an Apple iPhone, I have Apple TV. Like everyone, so many Apple devices in our home, it makes too much sense for them to have an Apple humanoid robot to pair up with that.
CAROLINE WOODS: So you’re not concerned about them losing their competitive edge because you think they might be developing something even greater than Siri?
SHAY BOLOOR: So I do believe they’re losing their competitive edge. I don’t think there’ll ever be a growth company anymore. I think they’re showing signs of just being these prints. So much cash. They’re a financial engineering firm. At the end of the day, in my opinion, buybacks, dividends, et cetera, that they don’t care about controlling the stack anymore because they don’t have the ability to do so. They want to be able to have their own models, have their own training data. They just don’t have the capability to do that. And that’s the risk of Apple falling even more behind. They have to pivot. And that’s the quickest pivot.
CAROLINE WOODS: So Apple’s 20% off the highs, would you buy there?
SHAY BOLOOR: I would not I think I’ve seen zero signs of innovation in the past decade. They spent $10 billion on that was just in prototype phase. Their Apple iPhone has not innovated in who knows how long they’re focusing on the old hardware world. The next hardware world isn’t going to be scrolling doing iOS updates. Oh, that looks clean. It’s not going to be that stuff. It’s going to be intelligence that’s verbalized. It’s going to take feedback loops like Open AI’s, pairing up with the talented, talented creator on who disrupted the smartphone space, or creating magic behind a box. They have him in house now, so I think that the future devices and society isn’t going to be something that’s manual as using your fingers, it’s going to be feedback loops where I’m wearing some device AI is telling me what’s happening and what to do about it. It’s going to be all just in the world environment. It’s not going to be as tangible as using your hands. And every time I see some innovation on Apple, it’s just, OK, that’s nice makeup, but it’s not disruptive of where the world is heading.
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