Apple gains a position as an observer on the OpenAI board, improving AI integration with Mac, iPad, and iPhone devices.
TakeAway Points:
- Phil Schiller of Apple gains access to the OpenAI board as an observer, allowing him to attend meetings but not cast a vote.
- This action comes after Apple said that it will include ChatGPT into its AI strategy for the iPhone, iPad, and Mac.
- With millions of users at its disposal and potential App Store revenue from paid ChatGPT versions for Apple, the cooperation is more strategic than financial.
Apple acquires a Position on the OpenAI Board
Apple Inc. has secured an observer role on OpenAI’s board as part of a significant agreement announced last month, further solidifying the relationship between the two companies. Phil Schiller, the head of Apple’s App Store and its former marketing chief, has been chosen for the position. According to sources familiar with the situation, Schiller will not serve as a full-fledged director but will attend board meetings without voting rights or other director powers. This arrangement is set to take effect later this year, and Schiller has not yet attended any meetings.
The observer role will place Apple on a similar footing with Microsoft Corp., OpenAI’s largest backer and primary AI technology provider. Observers gain insights into company decision-making processes, although they may be excluded from sensitive discussions, particularly those involving future AI initiatives between OpenAI and Microsoft. Representatives for Apple and OpenAI declined to comment on the matter.
Strategic AI Integration
Apple’s move to join OpenAI’s board follows its June announcement to integrate ChatGPT into its iPhone, iPad, and Mac devices as part of a suite of artificial intelligence features. This partnership with OpenAI, the most influential AI startup, is a strategic component of Apple’s broader AI strategy.
The company’s in-house AI technology, known as Apple Intelligence, includes features such as article and notification summarization, custom emoji and image creation, and voice memo transcription. A revamped version of Apple’s Siri digital assistant is also part of this effort, although many enhancements are expected to arrive next year.
Despite Schiller not leading Apple’s AI initiatives, his extensive experience and role as a steward of Apple’s brand make him well-suited for the observer position. Schiller, who stepped down as head of marketing in 2020, currently holds the title of Apple Fellow and oversees the App Store and product launch events. Outside of Apple, he serves as a director at medical technology company Illumina Inc.
Apple Partnership OpenAI
The partnership between Apple and OpenAI is not a financial arrangement but rather a strategic collaboration. OpenAI gains access to hundreds of millions of potential users, while Apple benefits from integrating a highly sought-after chatbot feature into its devices. Users will also have the option to access a paid version of ChatGPT on Apple devices, potentially generating App Store fees for Apple.
Apple is also in discussions with Alphabet Inc.’s Google and startup Anthropic about offering additional chatbots to customers. Additionally, the company is exploring potential agreements with Baidu Inc. and Alibaba Group Holding Ltd. to bring its AI features to devices in China. Apple Intelligence will initially launch in American English, with plans for an international rollout.
