Why OpenAI is considering legal action against Apple over Siri AI deal

OpenAI’s lawyers are already working with an external law firm to examine possible legal options, including issuing Apple a formal breach-of-contract notice, according to reports. The company is still seeking a negotiated solution and may not immediately file a full lawsuit.

Here’s what to know about the dispute.

The deal between Apple and Google

The tensions have also been aggravated by Apple’s broader AI strategy. Earlier this year, the company announced a multiyear AI partnership with Google, which would see Gemini technology power the next generation of Siri on devices like the iPhone.

The dispute comes at a sensitive moment for both firms. Apple has faced criticism and even legal scrutiny over delays to its AI-powered Siri features, while OpenAI is rapidly expanding its consumer and enterprise footprint amid intensifying competition in the generative AI market.

The partnership will see Apple pay about $1 billion a year for a 1.2-trillion parameter AI model developed by Alphabet Inc.’s Google to run its overhauled Siri voice assistant. This model will handle complex and multi-step requests, summarisation, and planning for the new, redesigned Siri.

The collaboration extends beyond just Siri. According to a joint statement, the next generation of Apple foundation models will be based on Google’s Gemini models and cloud technology. Apple confirmed it chose Google’s technology after careful evaluation, determining it provides the most capable foundation for its AI ambitions.

While the two companies have not made specifics of the agreement public, it is anticipated that Google will license the base technology of Gemini to Apple, with the iPhone maker making tweaks to it to work across its ecosystem. AI models like Gemini have two stages, one is called a pretrained model, where it is trained to generate a string of words together, and then comes the post training phase, where the model is offered a distinct personality. Google would most likely offer the pretrained version of Gemini to Apple.

To address any privacy concerns arising out of the deal, the companies have also said that Apple Intelligence (the company’s branding for its AI offerings) will continue to run on Apple devices and Private Cloud Compute (PCC), while maintaining Apple’s privacy standards. The company says its personal cloud ensures that personal user data sent to the PCC isn’t accessible to anyone other than the user.

Google’s stock briefly touched above a $4 trillion market valuation following the announcement.

Why Apple needs Google’s help

Apple has largely stood on the sidelines of the AI revolution that swept Wall Street following ChatGPT’s launch in late 2022. While competitors like Amazon, Meta, and Microsoft invested billions in AI infrastructure and products, Apple struggled to deliver on its AI promises.

The company had announced a significant Siri upgrade during its Worldwide Developers Conference 2024 keynote but was forced to delay the features. Apple acknowledged it would take longer than anticipated to deliver these capabilities, pushing the rollout from 2025 to 2026.

Google’s 1.2 trillion parameter model is significantly larger and more powerful than Apple’s own AI model, meaning the revamped Siri should be far more capable than what Apple could have developed independently in the same time frame.