Apple has a new AI strategy for the iPhone, and it starts with admitting defeat

The company is done trying to beat ChatGPT and Google at their own game.

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Siri powered by Gemini
Siri will soon be powered by Gemini | Image by PhoneArena
Apple may have just quietly admitted what a lot of us have been thinking for a while now: it can't win the AI race by itself. But rather than keep throwing resources at a strategy that wasn't working, the company seems to be doing something that might actually be smarter in the long run, letting everyone else's AI do the heavy lifting while Apple focuses on what it's always been best at.

Apple wants to turn your iPhone into an AI hub, powered by everyone but Apple


Bloomberg's lead Apple reporter Mark Gurman, in his latest Power On newsletter, breaks down Apple's reworked approach to AI, and it's less about Cupertino building the smartest assistant and more about making sure your iPhone is the place where all the smart assistants live.

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The plan, which is expected to be shown off at WWDC on June 8, has two main pieces. First, Apple is building an "Extensions" feature for iOS 27 that would let you download AI chatbots like ChatGPT, Gemini, or Claude and use them right inside Siri.

There would even be a special section in the App Store just for these AI tools, kind of like an AI app store within the App Store. Second, Apple is using Google's Gemini tech to rebuild Siri so that when you first set up your phone, the default assistant actually works well enough that you won't immediately want to replace it.

Instead of trying to build a better chatbot than OpenAI or Google, something Apple has struggled with for a while now, the company is positioning the iPhone as the home base for whatever AI you prefer. And yes, Apple still gets its usual 30% cut from any AI subscriptions you sign up for through the App Store.

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This is bigger than just a Siri update


Let's be clear about what's happening here. Apple is basically saying that its own AI isn't going to catch up to the competition anytime soon. That's a pretty wild thing to acknowledge for a company that usually wants to own every part of the experience from top to bottom.

The easiest way to think about it is how the App Store already works. Apple makes its own apps like Mail, Maps, and Safari, but you're free to download Gmail, Google Maps, or Chrome instead. Apple still makes money either way. That playbook has worked great for years.

But AI is a lot more than just another app you swap out. As the report puts it, AI is shaping up to be the next operating system, which makes opening the door to competitors feel like a much bigger deal than just letting you pick a different email app.

Apple reorganized its entire AI team last year because things clearly weren't moving fast enough internally. Now, with WWDC right around the corner, we're finally seeing what that reset looks like in practice.

Knowing when to pivot is half the battle


I'll be straight with you: Apple dropped the ball on AI. The constant Siri delays, the lackluster Apple Intelligence features, the internal frustration over promises they couldn't keep, all of it paints a picture of a company that genuinely tried to make this work in-house and just couldn't get there. That's not me being harsh, it's just what happened.

That said, recognizing a losing battle and switching gears instead of stubbornly pouring more into it? I can respect that. You have to know when to fold and move to Plan B, and Apple's Plan B plays right into its biggest advantage: the hardware and the ecosystem people are already locked into.

I won't pretend Apple planned this all along. They landed here because their original approach didn't pan out. But the idea of letting the best AI companies compete for space on your iPhone while Apple collects a cut of everything?

That's a business model that could actually work long-term. The real test will be whether iPhone users end up feeling like they're getting a genuinely great AI experience, or just a middleman between them and the apps that are actually doing the thinking.

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