How much will ChatGPT pay to become the default AI on the iPhone?

Did you know that the Romans dated time by the reigns of their emperors, and that tech enthusiasts have redrawn the historical map into two eras: pre-Google, referring to 1998 when search engines like AltaVista and Yahoo! faded away, and post-Google? Today, we face a similar turning point, but with different rules. The balance of power is no longer determined by who innovates the most, but by who reaches the user first and virtually sits on their screen. This is why there is a fierce race between OpenAI Google is vying to see who will be able to install its AI on Apple phones, as the winner will dethrone the other and claim the top spot. This article will highlight this epic race and explore how much ChatGPT will pay Apple to become the default AI for iPhones.

History repeats itself in different ways

Over two decades ago, a single search engine revolutionized the internet, swallowing up its competitors until Google became synonymous with search itself. But in November 2022, a seismic shift occurred that shook the giant search engine's calculations when the ChatGPT chatbot was launched, threatening Google's position as the world's leading source of knowledge. The shock lay not only in ChatGPT's power but also in its speed and ability to alter user behavior. Suddenly, people were no longer typing keywords but posing complete questions and waiting for ready-made answers. This moment brought back memories of how Google had dethroned other search giants in the past, but this time, it was Google's turn.

When the magic backfired on the magician

For years, Google was blissfully unaware, despite possessing all the tools of dominance, including a cadre of scientists, Transformers (a type of neural network designed to process sequential data), and proprietary hardware and processors specifically designed for artificial intelligence. Like Nokia, it was complacent in its position. Then ChatGPT stole the show. Ironically, Google had invented the Transformer architecture upon which ChatGPT was built. But the company turned the tables with the release of Gemini 3, a version that shifted the focus of fear and anxiety from Google's offices to the halls of OpenAI, heralding a new and more intense phase in the AI ​​race.

Default settings: Power that cannot be changed

Today, artificial intelligence is no longer rare; quite the opposite, in fact. A huge number of models exist, all competing through numbers and tests. But the simple truth is that the average user doesn't care who wins these tests. All that matters to them is whether the tool is free, works instantly, and is integrated into their phone without any configuration. As you know, there's a constant truth in the technology sector, especially in devices and smartphones: the average user never changes the default settings. We use what's already on our phones. This is why Windows dominated—because it came pre-installed on computers. And this is why Google dominated—because it was the default search engine. Today, artificial intelligence is heading in the same direction. So, the model that will be pre-installed on smartphones will be the one to win the race.

Why is the iPhone the new battleground for artificial intelligence?

You might wonder why there's competition over who will be the virtual AI for iPhones? The short answer is that when it comes to Android phones, the battle is almost over because Google owns the system, and therefore Gemini will be the winner and will undoubtedly be pre-installed on Android phones.

But what about the iPhone? The situation is far from settled. Apple doesn't yet have its own flagship model, so there's still a chance for OpenAI and its ChatGPT model. However, for ChatGPT to win, it will have to spend billions, similar to what Google does to remain the default search engine on Apple phones.

The question here is, How much will ChatGPT pay Apple to become the default AI for iPhones? History suggests the figure could be astronomical. Negotiations between Apple and OpenAI are expected to begin for an annual fee of between $5 billion and $10 billion to integrate ChatGPT into select applications or Siri. If users subsequently adopt ChatGPT and it becomes indispensable, the figure could skyrocket, potentially exceeding $20 billion.

Note that these figures are based on analysis and speculation, and you should keep in mind that search engines generate direct revenue from advertising for each query. The situation is different for chatbots, as their revenue depends on subscriptions or paid plans for advanced features, not advertising.

Ultimately, if OpenAI succeeds in securing a foothold within iOS, it will gain a strategic advantage that will ensure its continued dominance for years to come. However, if Apple decides to build its own model or opts to partner with Google, Sam Altman could face the same fate as Netscape, which was rendered obsolete by Internet Explorer and Chrome.

Source:

observer