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The current LLM companies are positively hemmorhaging cash and will soon collapse.
Except


Summary

Anthropic has made history by reporting its first profitable quarter, with Q2 2026 revenue soaring to $11.5 billion and positive adjusted operating income. This unprecedented achievement for a frontier AI lab directly refutes the long-held skepticism that such companies could never turn a profit due to escalating compute costs. Unlike mere run rates, these are booked sales, totaling $16.2 billion for the first half. The company's strong gross margins on API sales indicate previous losses stemmed from investing in future model training, not from unprofitable products.
 
Im already paying for iCloud+ for the personal domains and storage. Seems like a good bonus feature if it works. So far Siri and Apple Intelligence has been a big disappointment. I still trust Apple more than the other AI companies.
 
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Pass for me then. I already weaned myself off Apple Storage and am hosting a server at home that works essentially like iCloud, I also have a redundant server in an alternate location (parents house) that backs up to. Upfront costs were essentially the 16 tb worth of HDDs that were purchased pre-hikes.

Their fee just reinforces the fact that your data isn't just processed device side.
 
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Looking forward on seeing what is enabled/just how personalised all of this is once the RC has finished indexing my iPhone 17 Pro and iPad Pro M4. Whilst I’ve liked the idea of what Gemini could enable with access to my own data, I’m aware the resulting inferences are Google’s to sell to the highest bidding advertiser. With Apple’s touted privacy & verifiable privacy claims, I’m happier with Apple/Siri AI having access to my emails, messages & photo library along with the inferences that can be made from combining them.

As an Apple One pre3mium tier subscriber (primarily for the shared storage & music for my family), I’m interested to see what these extra allowances might be. I’m guessing it might be the server side LLM equivalent of the free 5GB iCloud storage vs the 2TB with my current subscription - the difference between ‘not much use’ and ‘can store and sync my entire family’s digital selves’.
 
I guess the very fact that owning an iPhone means you are already paying/subsidizing some of the features like Siri anyway. But, to charge extra for Siri, make sure it works. I fought Siri on my watch and Apple TV constantly.
 
It seemed clear to me that the limits on Siri would be for the more advanced features. You're still going to be able to set an alarm, or get map directions, without having to pay Apple. It's also clear that Apple is trying to keep as much as possible on the device, none of which should cause any external charges. People who try to use Siri like other AI systems may start to run into the limits, but the average user likely will hit them rarely if they start using a sophisticated feature of the AI system. The current Siri is so braindead that nothing it does should be an issue at all.

The iCloud+ subscription just gives us a bonus number of credits, it doesn't sound like they are planning to adjust the price tiers. Yet anyways, when all the new Home stuff comes out the new camera setups will likely require higher iCloud+ tiers like they do now, and that's the logical place to add a higher tier or adjust the pricing ladder. We'll just have to see...it's very possible Apple doesn't know yet how this is going to impact them, they may have tried to keep queries on device and it may be that people just do stuff that doesn't stay there.

If you continue to use Siri as you do now (or not use it), then I don't think any of this will matter, that's what Apple seems to be aiming for. Siri will not be ChatGPT, it's meant as a support system instead of an actual AI, so it shouldn't come close to the same level of data center use. I guess we'll see though.
 
Aren't you supposed to get your users hooked before you start charging?

This is like introducing the worst drug ever and then telling people, "Yeah, next hit is going to cost you!" 🫤
 
"Hey Siri give me directions home"

"Pony up"

Nothing surprising here. What will be a kick in the teeth if we have to pay and it is braindead compared to its competitors.

It is only the models that run off the device that are incurring the charge. On device stuff not. Given your phone 'knows' you home address and can push that into Maps locally. there is not much for the cloud server to do here.
Simple voice commands. ( call mom, what is on my to do list , etc. ) don't really need some giant model.

On your device it is your device and burning up your electricity stored in the battery (or from wall plug). To the cloud, is a different set of equipment that you don't own and Apple pays the bills on ( cooling , admin, networking , etc. ). Use that equipment substantially and want you to pay up.

Really ,really old Siri used to have to send almost everything to the cloud to get processed. That is not absolutely necessary anymore.
 
It is only the models that run off the device that are incurring the charge. On device stuff not. Given your phone 'knows' you home address and can push that into Maps locally. there is not much for the cloud server to do here.
Simple voice commands. ( call mom, what is on my to do list , etc. ) don't really need some giant model.

On your device it is your device and burning up your electricity stored in the battery (or from wall plug). To the cloud, is a different set of equipment that you don't own and Apple pays the bills on ( cooling , admin, networking , etc. ). Use that equipment substantially and want you to pay up.

Really ,really old Siri used to have to send almost everything to the cloud to get processed. That is not absolutely necessary anymore.

It was just a joke....
 
The current LLM companies are positively hemmorhaging cash and will soon collapse. Coz it's so expensive to run, and no one pays the true cost. It's all discounted with no means of repaying investors.

they are likely not going to collapse. It is relatively easy to stop excessively handing out 'free stuff'. Just start charging. Two things going on here. One, is akin to the drug dealer "first couple of crack rocks free" model where look to get the customer addicted first and then collect money as they can't really escape anymore.

They are also shotgun shooting at usages to see which ones stick and which ones don't. Again once see traction... turn the fees on by lowering free limits.
 
... It's also clear that Apple is trying to keep as much as possible on the device, none of which should cause any external charges. People who try to use Siri like other AI systems may start to run into the limits, but the average user likely will hit them rarely ... The current Siri is so braindead that nothing it does should be an issue at all. ...

Indeed; based upon their description of how their tiered model system is supposed to work, typical users should never have an issue. The problem, as I see it, is that Apple's system orchestrator may not yet be functioning as intended. Queries which should never need to reach out to the internet (because they're just replicating features of the previous Siri, or performing some other equally simple task) are still behaving as though they're reaching out to the internet models by default. In the best case scenario, this only introduces unnecessarily long delays before completing the requested action. In the worst case scenario... Apple is (ahem) "accidentally" bleeding their customers dry, leading to everyone turning off Siri AI before it has even had a proper chance to prove it's value.

TLDR: Apple really needs to get that system orchestrator nailed down, or this will likely go badly for them.
 
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