Getting tired of this... "A.I. = LLM" therefore, if you don't have an LLM you're behind in A.I.
Apple decided to go down a different path and concentrate on on-device models - and they've succeeded, even surpassing everyone else in that regard. Apple being "behind" is just from the perspective that Apple doesn't throw technology against the wall and see what sticks. They are extremely thoughtful on how they use and implement technologies. Apple Intelligence is a clear example of that. They didn't just create an LLM and plug it into their operating systems, they created disparate features throughout the system... and, instead of wasting resources and creating their own LLM to compete against all the others, they decided to allow users a method to use their "favorite" LLM's if they so choose.
I also think it was a wise decision to separate Apple Intelligence features from other A.I. features in the system, so that "Apple Intelligence" mainly refers to those things that generate content or perform a task. So things like, object detection, scene detection, voice recognition and replication, text/handwriting recognition and replication, sound recognition, language translation, etc. are all not part of it.