In a groundbreaking partnership, Apple and Google have announced a deal that will see Google’s Gemini AI model power Siri’s artificial intelligence capabilities. The collaboration aims to enhance future Apple Intelligence features, including a more personalized version of Siri expected to launch this year.
According to a joint statement from both tech giants, Apple conducted a careful evaluation and determined that Google’s AI technology provides the most capable foundation for Apple Foundation Models. The companies expressed excitement about the innovative experiences this partnership will unlock for Apple users.
The market responded positively to the announcement, with Alphabet’s stock jumping as much as 1% on Monday, briefly pushing the company’s market capitalization to $4 trillion during trading. This milestone came just days after Alphabet overtook Apple as the second most valuable company behind Nvidia.
Speculation about this partnership has been circulating since late 2024, with Bloomberg reporting in November that Apple was considering paying $1 billion annually to license the Gemini model. Wedbush analysts called the deal “a major validation moment for Google as a premier foundation model” and noted it would help Apple accelerate its AI strategy.
The partnership represents a significant shift for Apple, which pioneered the AI assistant market when it launched Siri on iOS devices in 2011. However, the iPhone maker has struggled to keep pace with competitors following the launch of ChatGPT in late 2022. Apple has delayed several Siri upgrades and restructured its AI division in recent months.
For Google, the deal provides crucial distribution advantages in the US mobile market, where Apple’s iPhone dominates. Gemini is already available as a standalone app, powers Google search features, and serves as the default AI assistant on Pixel smartphones. This Apple partnership significantly expands its reach.
Thomas Husson, VP principal analyst at Forrester, noted that while the deal might seem counterintuitive given the companies’ smartphone competition, it mirrors their existing arrangement where Google pays to be the default search engine on iPhones. However, a December federal court ruling now requires Google to limit search and AI app contracts to one-year terms, potentially affecting future negotiations.
Key Quotes
After careful evaluation, Apple determined that Google’s AI technology provides the most capable foundation for Apple Foundation Models and is excited about the innovative new experiences it will unlock for Apple users
This joint statement from Apple and Google explains the rationale behind the partnership, marking a rare admission from Apple that an external technology provider offers superior capabilities to its in-house solutions.
This is what the Street has been waiting for
Wedbush analysts made this statement following the announcement, reflecting investor enthusiasm about Apple finally addressing its AI capabilities gap and Google securing a major distribution partnership.
This deal could look counterintuitive given Apple and Google compete in the smartphone market
Thomas Husson, VP principal analyst at Forrester, provided this observation while noting that the companies have successfully partnered before, particularly with Google’s search engine integration on iPhones.
Our Take
This partnership fundamentally reshapes the AI assistant landscape and reveals Apple’s pragmatic approach to catching up in the AI race. Rather than continuing to develop inferior AI capabilities independently, Apple has chosen speed and quality over pride. This decision is particularly striking given Apple’s historical preference for vertical integration and control.
The deal also highlights Google’s strategic positioning as an AI infrastructure provider, not just a consumer-facing AI company. By powering competitors’ devices, Google ensures its AI technology becomes ubiquitous regardless of platform preference. However, the regulatory constraints on contract length suggest authorities are watching these partnerships closely, potentially limiting how entrenched these relationships can become. The real test will be whether this integration can help Siri overcome years of stagnation and meet user expectations shaped by ChatGPT and other advanced AI assistants.
Why This Matters
This partnership represents a pivotal moment in the AI industry, signaling Apple’s acknowledgment that it cannot compete alone in the rapidly evolving AI landscape. After years of maintaining tight control over its ecosystem, Apple’s decision to integrate Google’s Gemini demonstrates how competitive pressures from ChatGPT and other AI assistants have forced even the most self-reliant tech companies to seek external partnerships.
The deal has significant implications for the AI market structure, validating Google’s position as a leading foundation model provider while giving it unprecedented access to Apple’s massive user base. For consumers, this means Siri may finally deliver the intelligent, contextual assistance that users have long demanded but Apple has struggled to provide independently.
The partnership also raises important questions about AI market consolidation and competition. With Google now powering AI features on both Android and iOS devices, concerns about monopolistic practices may intensify, especially given the recent federal court ruling limiting Google’s contract terms. This deal could reshape how AI capabilities are distributed across mobile platforms and influence future regulatory approaches to AI partnerships.
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Source: https://www.businessinsider.com/apple-google-gemini-to-power-siri-ai-capabilities-2026-1