Is Google Out of the Running on AI Search After Apple's 'Shocking' Comments?
Here's why two upcoming developer conferences may hold the answer.
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Shares of Alphabet GOOGL came under pressure Wednesday following reports that Apple AAPL is “actively looking at” revamping its Safari web browser to focus on AI-powered search engines. Those reports followed comments made Wednesday by Apple’s senior vice president of services, Eddy Cue, during his testimony in the U.S. Justice Department’s lawsuit against Alphabet.
Cue’s comments included that searches on Safari dipped for the first time last month, which he attributed to people using AI. Cue also said he believes that AI search providers, including OpenAI, Perplexity AI Inc., and Anthropic PBC, will eventually replace standard search engines such as Alphabet’s Google. He added that he believes Apple will bring those options to Safari in the future.
While Cue’s comments about AI replacing search may have shocked some people, it shouldn’t have, given the number of weekly ChatGPT users we discussed earlier as part of our Alert on Marvell MRVL. But we also know that Google is working hard on its own AI strategy, one that will leverage its position in search, shopping, YouTube, and other areas. Let’s also remember that, exiting the March quarter, it had more than 500 million users for its Gemini models, including Android. We’ve said before that while the AI landscape will become more competitive as new features are introduced over time, it would be a mistake to rule Google out.
Considering that we are still in a nervous market, where folks sometimes react too quickly to headlines, we’ll look to see what Google has to say at its upcoming Google I/O event that is less than two weeks away. Last year’s developer conference brought several Gemini announcements and search upgrades, and we expect more of the same later this month.
Two other questions stemming from Cue’s comments are whether Apple will instill an AI search engine across Safari, and could Google’s Gemini be one of the potential AI models for that? We believe the answer to the first question is that Apple will make such a move as part of its larger AI efforts, but when that will happen is the bigger question. That gives us another reason to pay close attention to what is announced during Apple’s 2025 WWDC that kicks off on June 9.
As to the second question, while Apple is working with OpenAI and ChatGPT as part of its iOS 18 and Siri efforts, Alphabet CEO Sundar Pichai confirmed last week that the company is getting closer to striking a deal to bring Gemini to the iPhone. Another reason we will be tuning into 2025 WWDC.
At the time of publication, TheStreet Pro Portfolio was long GOOGL, MRVL and AAPL.
