NYT: Apple's AI Struggles Began with 2023 Chip Budget Dispute

[MacRumors]

Apple's current struggles with Apple Intelligence and Siri began in early 2023 when AI head John Giannandrea sought approval from CEO Tim Cook to purchase more AI chips for development, according to a new report from The New York Times.

Cook initially approved doubling the team's chip budget, but CFO Luca Maestri reportedly reduced the increase to less than half that amount, and instead encouraged the team to make existing chips more efficient.

The lack of adequate GPU resources meant Apple's AI team had to negotiate for computing power from providers like Google and Amazon.

At the time, Apple's data centers had about 50,000 GPUs that were more than five years old – far fewer than the hundreds of thousands of chips being purchased by competitors like Microsoft, Google, and Meta.

The NYT report goes on to cover the leadership conflicts within the company, describing a power struggle between Robby Walker, who oversaw Siri, and Sebastien Marineau-Mes, a senior executive with the software team. The two reportedly battled over who would spearhead Siri's new capabilities, with both ultimately receiving pieces of the project.

Apple Intelligence faced significant delays after internal testing revealed Siri was inaccurate on nearly a third of requests. Apple subsequently admitted that it would take longer than expected to roll out the more personalized ‌Siri‌ experience, and that these features will be rolled out "in the coming year."

However, according to the report, Apple still plans to release its enhanced Siri experience this fall. The functionality includes personal context, onscreen awareness, and improved app integration. Some Apple executives reportedly aren't concerned about the delay, and believe competitors haven't perfected AI either, giving Apple time to get it right.

Following the delay, software chief Craig Federighi reorganized executives, removing responsibility for the new Siri from Giannandrea and reassigning it to Mike Rockwell, who leads the Vision Pro division. The details of Apple's Siri team changes and the delayed Siri revamp were previously reported by Bloomberg and The Information.

For more details on Apple's internal issues, including political infighting, budget constraints, and talent drain, see The New York Times' full report.

Article Link: NYT: Apple's AI Struggles Began with 2023 Chip Budget Dispute

 

[senttoschool]

Apple should have went all in on AI. LLMs directly threaten Apple's business.

Eventually, LLMs might get good enough that you do most of your things inside it, and not in iOS.

 

[D-a-a-n]

Seems like they're struggling with a lot of things lately. Vision Pro, AI, software quality,... Maybe too many politics at board level.

 

[antnythr]

Apple Employees: Can we have AI?

Apple: We have AI at home

The AI at home:

At the time, Apple's data centers had about 50,000 GPUs that were more than five years old — far fewer than the hundreds of thousands of chips being purchased by competitors like Microsoft, Google, and Meta.

 

[Falco McGregor]

So now we have John Giannandrea or people close to him leaking to the press that the Apple Intelligence issues aren’t his fault. Reports from Bloomberg, The Information and now The NY Times on this are basically spinning narratives from the different camps at Apple to pin the blame. And at the end of the day, it sounds like most of these features will be out by September anyway. Embarrassing for sure but not nearly as big a story as the macro-economic forces that are far more a threat to Apple in the next three years.

 

[beltzak]

The CFO always diversifying money where more is needed, their own bloody pockets. Such visionary people.

I understand their job but if there isn’t any opposed force to overtake their bad decisions you’re screwed.

 

[Adam Warlock]

Sounds like a ridiculous excuse. The extra horsepower is certainly welcome, but does not prevent development of AI.

 

[wanha]

Sounds like Apple committed the cardinal sin of innovation:

Trying to innovate in a cost-effective way.

That's a contradiction, because innovation requires exploring unknown territory, which means trying approaches that may not work.

Without this exploration, a company limits itself to incremental improvements within known boundaries - ie not actual innovation.

Innovation is thus inefficient by definition, and it requires leadership to acknowledge this in order for innovation to receive the resources it needs.

 

[goodcow]

Sounds like Apple committed the cardinal sin of innovation:

Trying to innovate while operating in a cost-effective way.

It never works, because innovation requires exploring unknown territory, which means trying approaches that may not work.

Without this exploration, a company limits itself to incremental improvements within known boundaries.

Tim was probably weary after setting a bunch of cash on fire developing the Vision Pro.

 

[Falco McGregor]

Sounds like Apple committed the cardinal sin of innovation:

Trying to innovate while operating in a cost-effective way.

It never works, because innovation requires exploring unknown territory, which means trying approaches that may not work.

Without this exploration, a company limits itself to incremental improvements within known boundaries.

I also think this line, which is in The NY Times piece, but not the summary here is absolutely key: “Mr. Giannandrea, who joined the company in 2019 from Google, had never led the launch of a high-profile product like the improved Siri.” What has Giannandrea been tasked with for the past six years and what has he delivered?

 

[triom]

I think Apple’s approach of not creating their own LLM is great. They should also let the user choose their own model (and not limit to ChatGPT). Where they’ve gone wrong is their ability to write software and ship code.

 

[snipr125]

Best thing about Apple Intelligence is the 16GB RAM as base on Macs (and turning AI ‘OFF’ hehe).

 

[Jarman74]

Cook initially approved doubling the team's chip budget, but CFO Luca Maestri reportedly reduced the increase to less than half that amount, and instead encouraged the team to make existing chips more efficient.

What’s most staggering here is that Siri’s abysmal performance compared to the competition went unnoticed or was brushed off, even in light of ChatGPT’s obvious superiority at the beginning of 2023—especially when GPT-4 was released.

I’m all for sensible investment and spending, but if you failed to notice that Siri was being outperformed by every other assistant year after year—and despite sitting on an unfathomable pile of cash, you remained hellbent on penny-pinching—the full responsibility for the Apple Intelligence debacle falls squarely on you. It leaves me wondering whether Maestri was shown the door when the mistakes could no longer be swept under the rug.

 

[wanha]

Tim was probably weary after setting a bunch of cash on fire developing the Vision Pro.

I'd imagine the Apple Car cost a lot more and produced a lot less...

Spatial computing could still be a thing, assuming the tech catches up.

 

[brijazz]

These massive companies never seem to get it.

"Hey, can we save $1 now?"
"Yeah, but it'll cost you $5 later."
"As long as the shareholders are happy! 'Later' is someone else's problem."

 

[brijazz]

I think Apple’s approach of not creating their own LLM is great. They should also let the user choose their own model (and not limit to ChatGPT). Where they’ve gone wrong is their ability to write software and ship code.

You might like my approach to hitting home runs, but if I can't get my bat on the ball it doesn't matter much.

 

[wanha]

What’s most staggering here is that Siri’s abysmal performance compared to the competition went unnoticed or was brushed off, even in light of ChatGPT’s obvious superiority at the beginning of 2023—especially when GPT-4 was released.

I’m all for sensible investment and spending, but if you failed to notice that Siri was being outperformed by every other assistant year after year—and despite sitting on an unfathomable pile of cash, you remained hellbent on penny-pinching—the full responsibility for the Apple Intelligence debacle falls squarely on you. It leaves me wondering whether Maestri was shown the door when the mistakes could no longer be swept under the rug.

You could argue Siri has managed to avoid an honest internal review ever since it launched in 2011 (to mixed reviews from tech reviewers and users)

Amazingly, it's never really improved and yet somehow no one at Apple noticed or cared.

 

[Aeronauts]

Why is the world’s richest company penny pinching on development costs? They seem more interested in their share price than their products and customers.

 

[lkrupp]

Bean counters, you can't live with ‘em and you can’t live with ‘em. 🤡


When Ma Bell was in its heyday they set up Bell Labs, hired the best they could find, gave them tons of money, and told them to do their thing, whatever it was. Pure, unfettered research and development. And the world was better for it... until the bean counters took over.

 

[Eriamjh1138@DAN]

Tim was probably weary after setting a bunch of cash on fire developing the Vision Pro.

And spending $10B on the Apple Car.

 

[KnowsHowItWorks]

Shocking level of management incompetence. You never needed a full fledged llm at the precise moment. You needed a content awareness for routine tasks which would buy you a precious time when models would actually get cheap. But not really surprised.

 

[ksec]

At the time, Apple's data centers had about 50,000 GPUs that were more than five years old

50K GPU that were 5+ years old? I mean give them credit for what they have now!

When others have 10-50 times more resources.

 

[rymc02]

Seems like they're struggling with a lot of things lately. Vision Pro, AI, software quality,... Maybe too many politics at board level.

What politics have to do with it? Seems like a lack of coherent leadership from the top if these reports are true.

 

[ericinboston]

So with all the AI hype back then and now, regardless of your position within Apple, the industry, or consumers and what you believe, Apple chose NOT to invest in this so-called "wave of the future", "game changer" technology (AI). Are you kidding me? They've got billions and billions and billions in the bank, a huge market cap, and they cheap out on R&D. Look where it got them. Not only essentially last place on the AI train but a huge black eye for PR and likely a massive class action law suit. Great job, Apple!

 

[jlc1978]

The CFO always diversifying money where more is needed, their own bloody pockets. Such visionary people.

I understand their job but if there isn’t any opposed force to overtake their bad decisions you’re screwed.

It's hard to say what actually happened; but at any company I worked for if the CEO said spend it it got spent.

Some CFOs, can be your friend. At one, the CEO required a signature for any computer costing over X; back in the days when even laptops had replaceable HD's and memory. Our CFO came up with a great solution as most machines we needed cost about 1.1 to 1.3 x. So he bought the machine at .75 X without memory or HD, the HS and memory at about .4x without a signature, and the supplier 'put the two together' , getting us what we needed and not having to justify every purchase, saving time.

What politics have to do with it? Seems a lack of coherent leadership from the top if these reports are true.

Corporate politics may have been at play here, we really don't know. It does seem like decisions were made in a bit of a vacuum, and unlike Apple under Jobs people feel more free to change decisions made by the CEO.