Google, Amazon and Apple race to get AI on their most popular devices

Google, Amazon and Apple race to get AI on their most popular devices

Big Tech wants to put artificial intelligence in your pocket, your palms, and your home.

Meta (META), Apple (AAPL), Amazon (AMZN), and Google (GOOGL) are spending billions of dollars and marshaling vast resources to incorporate AI into some of the most familiar consumer technology products, as they look to benefit from and accelerate the rapid adoption — and business upside — of the new tech.

Meta has incorporated its AI chatbot into its popular social media platforms Instagram and Facebook. Apple finally rolled out its own AI suite, Apple Intelligence, in late October. Google has built AI summaries into its market-dominant search engine and rolled out its own chatbot, Gemini. And an AI upgrade to Amazon’s smart home device Alexa is in the works — though it has reportedly struggled to get it out the door.

“What is most important is that the user behavior needs to be established,” said Tejas Dessai, director of research at Global X, an investment management firm that issues exchange-traded funds. “What you’re seeing with so many people using tools like ChatGPT, for example, is that they’re getting accustomed to using these technologies on a regular basis. And once that happens, people start to build intuition for these functionalities.

“That is very important and that is already forming, but the next iteration of bringing these models closer to everyday usage is integrating them seamlessly in platforms that are already very popular,” he added. “And that is exactly what you’re seeing happen with Apple.”

Read more: Microsoft has a plan to beat Apple and Google at AI

Dan Ives, a tech analyst at Wedbush, said familiar devices will be the foundation for what he calls the “consumer AI revolution.” Wedbush estimates that 20% of the world’s population will ultimately access AI through an Apple device over the coming years. There were more than 2.2 billion active Apple devices worldwide as of February.

“We expect developers over the next 6 to 12 months will build hundreds of generative AI driven apps that will be key ingredients in the recipe for success for Apple as its technology stack creates the core building blocks of the consumer AI tidal wave we see coming starting with iPhone 16,” Ives said in research note in September.

Some are betting that new AI hardware could be the vessel to help bring the technology into more people’s hands. Legendary Apple design guru Jony Ive, for example, is starting an AI device firm with the help of OpenAI CEO Sam Altman and Laurene Powell Jobs.

But even Altman says AI adoption could exist in the cloud and be accessed through people’s existing devices — without needing a shiny new piece of tech in their hands.

“I don’t think it will require a new piece of hardware,” Altman said in a May interview with The MIT Technology Review.

Dessai expects AI to roll out in phases, starting with the development of AI infrastructure that we see right now. Next is the development of software, such as cloud tools, Dessai said. The final stage will be new interfaces, like a virtual assistant or chatbot, that users will ultimately interact with.

“In due time you will get exciting interfaces that will potentially transform everything from financial services, to travel, to how you order food, to how you plan your entire day,” Dessai said. “And that’s where I think a lot of the value-unlock will happen with artificial intelligence.”

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Major tech companies have already made significant progress in getting AI products, tools, and features into their users’ palms.

Mark Zuckerberg has said Meta AI already has more than 500 million monthly users, putting it on track to become the most used AI assistant in the world by the end of 2024. AI is also boosting Meta’s existing core businesses: AI-driven feed and video recommendations have resulted in an 8% increase in time spent on Facebook and a 6% increase on Instagram this year, Zuckerberg said in a call with analysts last month.

“It’s clear that there are a lot of new opportunities to use new AI advances to accelerate our core business that should have strong ROI over the next few years,” Zuckerberg said. “So, I think we should invest more there.”

“And second, our AI investments continue to require serious infrastructure, and I expect to continue investing significantly there too,” he added.

Apple has had a bumpier road. The Cupertino, California-based tech giant unveiled its AI initiative, Apple Intelligence, in June. It features a slate of new tools for iPhone 15 Pro models and higher, including the ability to understand and create images and language; edit, change tone, and proofread text; and create new emojis using a typed description. Apple’s voice assistant Siri will also become more conversational and receptive, and will allow users to access ChatGPT directly from their devices.

While September quarter sales showed strong demand for the iPhone 16 lineup, it remains to be seen whether Apple Intelligence will have a significant impact given its delayed rollout. Many early users of Apple Intelligence were underwhelmed by the features.

A recent CNET survey found that smartphone users aren’t yet sold on the new tech, with a quarter of them saying that they don’t believe AI is useful.

Read more: Apple Intelligence is here. Early users are underwhelmed

It’s still early in the game, with other stalwarts also trying to find their footing in a new, AI-driven world. Amazon, for example, still has yet to add its AI-powered tools to its slate of physical tech, such as Alexa.

The Seattle, Washington-based company is expected to unveil a new Alexa powered by AI startup Anthropic’s Claude artificial intelligence models, Reuters reported in August. Amazon has invested billions of dollars into Anthropic, and the AI startup in turn uses AWS as its primary cloud provider for AI safety research and model development.

During Amazon’s third-quarter earnings call last month, CEO Andy Jassy said the company is continuing “to rearchitect the brain” of its voice assistant with a set of next-generation foundation models — larger models trained on broad, generalized data sets.

Jassy said Amazon would share the new models with customers soon, and that the company is “increasingly adding more AI into all of our devices,” including the Kindle.

Alexa is facing stiff competition from rival Google Home devices and Nest speakers, which are slated to receive generative AI upgrades before year’s end, the company announced in August. Apple is also reportedly working on its own smart home hub, which will rely heavily on Apple Intelligence.

Smart home devices, like Amazon’s Alexa and Google’s Nest, are growing in popularity. It’s estimated that more than 130 million households will have at least one smart speaker by 2027.

The long game, Dessai said, is a world where everyone’s electronics include AI features to seamlessly support their everyday activities. But that shift won’t happen overnight.

“Ultimately we believe that consumer devices — smartphones, your vehicles, consumer electronics inside your homes — will likely integrate these models in one way or another, where these models capture information around behavioral patterns, process things and make it much easier for you to use those devices or those interfaces,” Dessai said. “And that’s really when you will see artificial intelligence really truly integrated into consumer lives.”

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