If they end up renting rather than building that capability, it says to me that they’re betting on being able to move most of that locally to the phone on a relatively short time horizon, which is interesting.
I'm not so sure whether this is the direction of travel. The economics are pretty harsh for local, general purpose AI. And battery will always be a limiting factor.
If you're sending a few hundered requests per day to a very powerful AI then sharing the cost of the inference machinery with others has overwhelming economic advantages. And it will need access to current data anyway, so it can't be completely local.
There will be tasks such as keyboard autocomplete and a lot of other specialised tasks where latency or privacy is more important than quality. So yes I do believe in hybrid. But I think the cloud will always do the heavy lifting when it comes to more general tasks.
I can imagine an alternative scenario where a lot of AI processing happens on Mac and PC and mobile devices benefit from that. But many people don't have powerful desktop devices. So I'm not sure Apple can rely on this.
>Apple is preparing new capabilities as part of iOS 18 — the next version of the iPhone operating system — based on its own AI models. But those enhancements will be focused on features that operate on its devices, rather than ones delivered via the cloud. So Apple is seeking a partner to do the heavy lifting of generative AI, including functions for creating images and writing essays based on simple prompts.
I can't see how they can delivery 'thoughtful integration' with the Apple services when work is being done on Googles servers, but perhaps the "efficient inference on device" (which could be the biggest product leap for Apple since the iPhone) is taking too long and they need a stop gap to stop the downward pressure on their shareprice.