It's worse than that. With Apps using AI, which contain valuable ML models that can be lifted and stolen, this hampers innovation. I was working on an iOS App last year for a company which wanted to move it's AI from the cloud to on-device. In the end they decided it was too risky as even iOS can't secure their IP.
At Apple WWDC last year Apple introduced some measure to try to combat this but it only works, and encrypts, with models that use Apple's ML lib exclusively. Even then it stlll isn't 100% certain it is secure. Not with this software in the wild now.
Unless a platform like iOS, or MacOS, can offer an un-jailbreakable environment our devices will always need to be tethered to the cloud for advanced applications that use AI.