Apple has been exposed to a big move again, self-developed device-side large language model, AI is a new way out of "revitalization"?

The AI scene is still hot, with tech giants racing to get there. Although Apple is a step late, it is also catching up with this craze.

Following the previous rumors that the iPhone intends to embed Google's Gemini large model, Apple has recently been exposed to develop its own device-side large language model.

After ten years of shattering the dream of building a car, Apple's determination to enter the AI game seems to be becoming more and more firm.

Last week, Nvidia led a group of technology stocks to crash, and Apple did not resist. As one of the "Big Seven" of U.S. stocks, Apple's stock price has been declining since the beginning of the year, with a cumulative decline of more than 11%.

Revive the iPhone and find the next revolution

Behind the weak stock price and declining market capitalization,

It's Apple's trump card product that can't be sold.

According to the latest data released by IDC, iPhone sales in the first quarter of 2024 fell by nearly 10% year-on-year, and the leading position in the global smartphone market was replaced by Samsung.

With the further recovery of the market, IDC also expects that

This year, Android phones will grow much faster than Apple.

Sales "Waterloo", market position is difficult to protect.

In order to "reinvigorate" the iPhone and find the next revolutionary product, Apple has plunged headlong into the wave of AI.

According to a new report from tech journalist Mark Gurman, Apple is working on a large language model (LLM) that runs on the device side, aiming to improve the responsiveness and privacy protection of the upcoming generative AI features.

In the article, he said,

Apple's next big thing: large language models on devices.

Apple's LLM will be the foundation for the company's future generative AI capabilities.

However, Apple's AI tools may in some cases lag behind competitors that run directly in the cloud because they run on the device, but the way it implements the technology could still be a game-changer.

At the same time, Gurman also pointed out that Apple could bridge this gap by licensing the use of technology from other AI service providers such as Google.

It is reported that Apple's AI technology marketing strategy will focus on how it can effectively help users improve the efficiency of their daily lives, rather than simply emphasizing the powerful performance of the technology itself.

According to people familiar with the matter, the two companies were in active talks earlier to allow Apple to license a set of generative AI models from Google, Gemini, to power some new features in the iPhone software this year. In addition, Apple has recently held discussions with OpenAI and is considering using its models.

However, Apple has not responded positively to these news.

The market expects that

More details of Apple's AI strategy will be announced at the WWDC conference in June

, where the company will also present its major software update plans.

way out

It is worth noting that Apple is expected to release its latest quarterly earnings report on May 2.

The market is widely expecting another decline in performance.

Wall Street expects iPhone sales to fall again, which will drop overall revenue by about 5%, the fifth decline in the last six quarters.

An indisputable fact is:

In recent years, the pace of iPhone upgrades has slowed down.

Since the release of the iPhone 12 in 2020, Apple's flagship products haven't changed much. And before that, there haven't been any major upgrades since 2017.

For Apple's way out,

With no major new product category launches in the near future, Gurman said, one option facing Apple is to produce cheaper versions of the iPhone and re-enter emerging markets.

In addition, Bernstein gave Apple a "in line with the broader market" rating and set a price target of $195 for the stock.

Recently, Apple has made a lot of reviews, acquisitions, hiring, and investments in building artificial intelligence, but has yet to release any new artificial intelligence products.

While many expect Apple to make a big announcement at its Worldwide Developers Conference in June, Bernstein's analysts expect that

Apple will wait until September to announce the AI features when the iPhone 16 is released.

"We expect most of the AI features to be released with the iPhone in September, rather than at the Worldwide Developers Conference, as are other key software features such as the Dynamic Island, Siri, and Facetime, all of which were introduced at the launch of the phone. In our view, the timeline for AI features such as multimodal Siri and AI health coaching is less clear. ”

Bernstein expects that the iPhone 16 will offer at least similar AI features to the Pixel 8 and Galaxy 24. Other possible AI technology integrations include Apple Music, Xcode, Pages, and Keynote.

While Apple is developing its own large language model (LLM), codenamed Ajax, the company is also in talks with potential partners such as Google, OpenAI and Baidu about using external large language models. ”

Bernstein also noted

There are three main ways Apple is using AI to make money.

These include enabling AI features on its iconic iPhone, capturing AI searches through ads, and charging commissions on AI apps.