Apple's Google Gemini Deal Could Be Worth $5 Billion

[MacRumors]

Apple's newly announced partnership with Google to use Gemini models for Siri and Apple Intelligence could be worth as much as $5 billion, according to one analyst's estimate.

The deal is structured as a cloud computing contract that will see Apple pay "several billion dollars to Google over time," according to the Financial Times (paywalled), citing a person familiar with the agreement. Gene Munster at Deepwater Asset Management puts the value at $5 billion for Google.

The arrangement is reminiscent of a deal made two decades ago that made Google's search engine the default on Apple devices, which grew to be worth about $20 billion annually to Apple.

Apple said it determined that Google's technology provides the "most capable foundation" for its Apple Foundation Models. However, the Gemini partnership raises questions about the future of Apple's existing ChatGPT integration, which has been part of Apple Intelligence since 2024. Apple said the Google deal does not affect the ChatGPT integration, but Munster expressed skepticism about its long-term prospects.

"I think that the ChatGPT integration is going to die on the vine... having two large models, given the economies of scale, wouldn't make a ton of sense for Apple," he told FT.

A person close to OpenAI told the newspaper that the company had taken "a conscious decision to not become the custom model provider for Apple" last autumn to focus on building its own AI device. That hardware effort is being led by former Apple design chief Jony Ive, who was hired by OpenAI in May 2024 – a move Munster suggested may have soured Apple on a deeper OpenAI partnership.

Despite the $5 billion figure, Apple's Gemini deal is comparatively conservative compared to other companies' AI infrastructure spending. Google, Microsoft, Amazon, and Meta have all committed hundreds of billions of dollars to new AI data centers since ChatGPT launched in 2022, but Apple has kept its investment in physical infrastructure at roughly 3 percent of revenue, according to FT's analysis.

For fiscal 2025, Apple's spending on property, plant, and equipment was $12.7 billion. Compare that to the roughly $90 billion Google is expected to spend this year. One former Apple executive told the FT that the Google deal was "a necessary byproduct of Apple's decision not to 'go big' on its AI investments like its competitors."

The next-generation version of Siri is expected to be introduced with iOS 26.4, which will likely be released to the general public in March or April.

Article Link: Apple's Google Gemini Deal Could Be Worth $5 Billion

 

[turbineseaplane]

That's it?

Now I'm getting more skeptical about "what else is in it for Google"?

 

[jayducharme]

I'm not holding my breath on this. I figured the ChatGPT integration was just a stopgap, since is was hastily implemented. It's the equivalent of Siri saying, "Here's what I found on the Web." The solution needs to be seamlessly integrated, and it sounds like that's what Apple is aiming for with Gemini. But we'll see. One thing I wish Apple would do is give me more choices for Siri's voice. They keep changing the choices with each major update, and they seem to get worse instead of better. Siri used to sound friendly; now it sounds either stern or bored.

 

[Ursadorable]

Don't care how much it's worth. I don't want anything Google on my device(s). In terms of worst tech companies in the industry, Google is the most exploitive next to Microsoft. I specifically bought into the Apple ecosystem so I didn't have to deal with Google.

 

[code-m]

Google for many years if not over a decade has been paying Apple to assign Google Search as the primary on its devices. Fast-Forward to 2026 and Apple is paying Google for its AI to be incorporated into its devices.

 

[antiprotest]

Even with an LLM handed right to them, Apple might mess this one up too.

 

[code-m]

I'm not holding my breath on this. I figured the ChatGPT integration was just a stopgap, since is was hastily implemented. It's the equivalent of Siri saying, "Here's what I found on the Web." The solution needs to be seamlessly integrated, and it sounds like that's what Apple is aiming for with Gemini. But we'll see. One thing I wish Apple would do is give me more choices for Siri's voice. They keep changing the choices with each major update, and they seem to get worse instead of better. Siri used to sound friendly; now it sounds either stern or bored.

Siri is frustrated hence sounds stern or bored with requests.

 

[hajime]

Disappointed to hear that Apple has partnered with that company. With all the information they have collected and are collecting, I let you to imagine what it could do to human mankind.

 

[AppleFan91]

That's it?

Now I'm getting more skeptical about "what else is in it for Google"?

Kneecaps their AI rival in OpenAI as now Gemini will be the default model for every mobile device in the world. Plus keeps another “competitor” in Apple from releasing their own (though this is probably not really factor cuz Apple seems to be quite behind no matter what with this)

 

[satchmo]

I'm not holding my breath on this. I figured the ChatGPT integration was just a stopgap, since is was hastily implemented. It's the equivalent of Siri saying, "Here's what I found on the Web." The solution needs to be seamlessly integrated, and it sounds like that's what Apple is aiming for with Gemini. But we'll see. One thing I wish Apple would do is give me more choices for Siri's voice. They keep changing the choices with each major update, and they seem to get worse instead of better. Siri used to sound friendly; now it sounds either stern or bored.

Isn't Gemini also suppose to be a stop gap until Apple get's its own LLM up to snuff?

Or perhaps Tim realizes how far they are behind and given up that approach.

 

[code-m]

Isn't Gemini also suppose to be a stop gap until Apple get's its own LLM up to snuff?

Or perhaps Tim realizes how far they are behind and given up that approach.

It would cost Apple more than $5 Billion to make Siri capable, this is the most financially sound decision.

 

[everlast3434]

I can't wait to get turn this off.

 

[dominiongamma]

Disappointed to hear that Apple has partnered with that company. With all the information they have collected and are collecting, I let you to imagine what it could do to human mankind.

Apple can finally catch up 15 years behind now

 

[switz]

Makes since to not have another financial behemoth creating power hungary data centers.

Apple is conserving cash like the "rent-to-own" model. When they are satisfied with their product, perhaps Google gets walking papers.

The Apple customers are not suiting up to get the Apple shaft for this folly called AI.

I see no way AI will improve my life, rather it will be so intrusive that perhaps most folks will hate it but the choice will be gone to use or not use.

 

[Return Zero]

As long as this is based on the same model as Gemini, but completely run on Apple-controlled hardware and unable to communicate with Google, I am 100% OK with this implementation. It'd be the same concept as running a local DeepSeek model... sure it was made by a Chinese company, but if it's not sending any data back to them, who cares? Your iPhone itself was made in China anyway. No matter the model you always have to be aware of bias, hallucinations, censorship, etc. That just comes with the territory.

For selective searching like they have now, I can't stand that we are forced to use chatGPT or nothing. Give us choice where we can have it, and privacy where we can't.

 

[Ursadorable]

I see no way AI will improve my life, rather it will be so intrusive that perhaps most folks will hate it but the choice will be gone to use or not use.

It's simply a tool. It can be used for good, or bad.

I prefer my approach, when I want to use AI, I fire up LM Studio and then shut it down when I'm done. I get to choose what LLM I wish to use, and know it's not invading various parts of my OS.

 

[AgeOfSpiracles]

Don't care how much it's worth. I don't want anything Google on my device(s). In terms of worst tech companies in the industry, Google is the most exploitive next to Microsoft. I specifically bought into the Apple ecosystem so I didn't have to deal with Google.

What world are you living in where Meta doesn't exist?

 

[dr.shai]

Alan Kay's quote:
"People who are really serious about software should make their own hardware."

OpenAI and Jony Ive teaming up to do exactly the right thing. I hope to see some impressive tech over the next decade.

 

[ifxf]

Wonder if this a barter situation where Google just reduces how much it pays Apple to be its default search engine?

 

[justanotherdave]

Don't care how much it's worth. I don't want anything Google on my device(s). In terms of worst tech companies in the industry, Google is the most exploitive next to Microsoft. I specifically bought into the Apple ecosystem so I didn't have to deal with Google.

Yes Google is the worst (their track record proves this) but I wouldn’t be worried about this deal.

Apple has been using Google servers for years to store your iCloud data (like pictures) and Apple has implemented procedures that make it IMPOSSIBLE for Google to see what data you’ve stored or even who it belongs to.

I don’t see Apple behaving any differently here. Google isn’t going to be getting any personal information from you despite the naysayers claiming so (with absolutely zero evidence, BTW).

 

[DougieS]

A person close to OpenAI told the newspaper that the company had taken "a conscious decision to not become the custom model provider for Apple" last autumn to focus on building its own AI device. That hardware effort is being led by former Apple design chief Jony Ive, who was hired by OpenAI in May 2024 – a move Munster suggested may have soured Apple on a deeper OpenAI partnership.

more likely decided not to do a custom model as they won’t be able to get user data if it’s in Private Cloud Compute.

 

[lazyrighteye]

So if this is landing in 26.4, they have this working in-house today, right?

I’m assuming they inked the deal only after seeing proof of concept and assurance they can deliver by 26.4.

 

[ProbablyDylan]

Am I alone in thinking that Gemini specifically isn't very good? Seems more prone to making stuff up than its contemporaries in my experience.

 

[TVreporter]

$5 billion? Crazy Tim this time around had to search between the pillows of several couches to scrounge up enough to pay!

 

[Unregistered 4U]

Kneecaps their AI rival in OpenAI as now Gemini will be the default model for every mobile device in the world. Plus keeps another “competitor” in Apple from releasing their own (though this is probably not really factor cuz Apple seems to be quite behind no matter what with this)

Some percentage of users, wanting to hand all their life decisions to AI, will opt to share more details with the third party partner. If even .01% of folks do that, it would still be a decent chunk of valuable data to Google.