Griffin on Tech: The promise and the peril of Apple Intelligence
Apple’s big debut in artificial intelligence this week at its worldwide developers' conference will have given software developers and app startups a lot to think about.
Apple Intelligence follows Microsoft’s move to bring on-device artificial intelligence to a new generation of Windows PCs, with the premium versions of the iPhone 15 and late-model Macs and iPads about to be supercharged with AI.
The high barrier to entry for many existing device owners means the impact of Apple Intelligence will be muted for a while. Apple hopes it will drive a new upgrade cycle, which it badly needs to address sagging sales of its flagship product, the iPhone.
But with the debut of iOS18 later this year, and other upgraded operating systems, we’ll begin to see how third-party developers are embracing the new AI features that are being extended to them with Apple’s updated SDKs (software developer kits).
These upgrades will allow intelligent functions native to Apple’s operating systems to interact with third-party apps, making those apps more useful in the process. I’m particularly intrigued to see how Siri could become much more effective at allowing you to interact with third-party apps using voice commands.
Apple’s AI will make third-party apps better
With ChatGPT’s functionality basically embedded in Apple devices moving forward, users have one of the best large language models in the business at their fingertips. Most third-party app developers will continue to employ their own large language models in the cloud to serve up answers and insights optimised for the application’s use case, whether it's business accounting, video editing, or comparing flight prices.
But as the demos at WWDC showed, a number of lower-level features powered by AI will now be available as part of Apple’s OS. That may put some app developers out of business.
As Capital Brief’s Bronwen Clune put it: “Grammarly, 1Password, language translators, Humane, Rabbit, most fitness apps, note-taking and productivity apps like Notion and Evernote, to-do-list apps, photo and editing apps, image generation apps, sleep cycle apps and even some of the big guns like Adobe Lightroom were all pronounced dead after the arrival of Apple Intelligence.”
I think that’s overstating it. But this isn’t the first time that an Apple launch has put app startups out of business. I’ve never spent a cent on Grammarly, 1Password, or Evernote, because they never had a strong enough value proposition in my book. But I’ll likely continue to use Otter.ai for recording and transcribing interviews and meeting notes because it is so good at the job and has totally embraced generative AI to great effect. I can’t see Apple replacing all of that sophisticated functionality.
There will be casualties
But I’d be more inclined to buy an iPhone if I got a rock-solid password vault, decent grammar checker and note-taking app built into iOS. The reality is that Apple can’t replace and doesn’t want to replace the vast majority of the apps in its App Store, which it clips the ticket on every sale of, generating billions of dollars in revenue for Apple every year. For software developers, particularly those working on enterprise apps, which Apple has never been particularly good at offering, Apple Intelligence is more of an opportunity than a threat.
If Apple can use AI to make our interaction with phones and computers more seamless, including the dozens of apps we navigate every day, that’s a good thing for developers. Those who suddenly have no moat around their business thanks to the rise of generative AI have some hard thinking to do.
As Supermix co-founder Xavier English, who offers back-office production and marketing services for a handful of popular podcasts told me this week, if you anchor your business on the premise of adding genuine, real value to your customers’ lives, your chances of success are good.
Plenty of life in new media
I was talking to Xavier on The Business of Tech podcast this week, where he walked me through a group of Kiwi-led start-ups attempting to reinvent a particularly moribund industry - the media. Substack, co-founded by Kiwi journalist Hamish Fletcher, and the likes of Letterboxd, Spalk, and Girls That Invest are all good examples of media companies that have built viable audiences and alternatives to digital advertising to sustain themselves.
What’s common to these businesses is that they either provide platforms to allow their customers to reach an audience without having to worry about logistics, admin and infrastructure, or they focus on building audiences in lucrative niches. There are lessons for the ailing mainstream media in these approaches.
It may not be the answer for the future of public interest journalism which is expensive and legally risky to undertake, but as Xavier pointed out, from popular YouTubers Coffeezilla to Bob Boy, there is some impressive and highly entertaining journalism being done by independent operators on beyond traditional media outlets that is attracting millions of readers, viewers, and listeners.
The rise of AI, and the digital disruption many industries are facing remind us that change is the only constant and we need to be willing to adapt to continue delivering value. If you are not, it should come as no surprise to you when your business ends up going the way of the flashlight app on the iPhone.
