Apple might buy Perplexity AI to bolster AI division

Apple is still considering its AI moves, and now it seems like the startup Perplexity might be on the menu.

A new report from Bloomberg’s Mark Gurman says that Apple is weighing the pros and cons of an acquisition that could help it acquire more AI talent and products. On the flip side, there are reports that Apple might partner with the company instead of buying it.

This partnership could lead to an AI search engine powered by Perplexity and integrating the company’s tech into Siri. The report says Apple has made no formal offers, but has met with the company several times lately.

This deal and/or partnership is likely spurred by two things. First is the potential for Apple and Google’s deal for search on iPhone to evaporate as U.S. courts look at Google as a monopoly on the search market. Apple is also seen as behind the competition in AI, and a major move like this is bound to be good for the stock price. The Bloomberg report mentions that Google’s stock fell a point after the news went live about Apple’s possible AI acquisition.

There’s also some speculation that Sam Altman and OpenAI’s deal with ex-Apple design legend Jony Ive on some AI hardware might be putting pressure on Apple to get into the AI game sooner rather than later.

That being said, Apple is working on its own AI tools, so it’s likely a matter of how long it thinks those will take to make and how much the company actually cares about what Wall Street thinks. There is an argument to be made that with Apple’s dominant market share in the iPhone, it can likely afford to be a few years late to the AI game, especially since we’ve seen so many issues with the current crop of generative and search AI tools. However, previous reports said Apple’s top executives are split on AI adoption, so things might be stalling in either direction.

The report also mentions that Meta has already made an offer to buy Perplexity, but the companies couldn’t come to an agreement, so Meta invested in Scale AI. Perplexity’s CEO says that Meta even tried to poach them for its ‘Superintelligence’ team. Meta has also approached staff from OpenAI and offered salaries with $100 million signing bonuses.

Meta’s investment in Scale was US$14.3 billion, (C$19.6 billion), so it stands to reason that the company offered a similar deal to Perplexity. The AI startup is valued at US$14 billion (C$19 billion) after its last funding round, so I expect it will cost even more if Apple wants to buy the company.

The big question I have at this point is, if Apple is considering making big AI moves, will that delay some of the already announced features, like the Siri enhancements we’ve been waiting for since WWDC in 2024?

Source: Bloomberg