Pressure is on Apple Inc to show it has not lost its magic despite broken promises to ramp up iPhones with generative artificial intelligence (GenAI) as rivals race ahead with the technology.
Apple is to showcase plans for its coveted devices and the software powering them at its annual Worldwide Developers Conference (WWDC), which starts today in Silicon Valley.
The event comes a year after the tech titan said a suite of AI features it dubbed “Apple Intelligence” was heading for iPhones, including an improvement of its much criticized Siri voice assistant.
Photo: Reuters
“Apple advertised a lot of features as if they were going to be available, and it just didn’t happen,” Emarketer senior analyst Gadjo Sevilla said.
Instead, Apple delayed the rollout of the Siri upgrade, with hopes that it would be available in time for the next iPhone release, expected in the fall.
“I don’t think there is going to be that much of a celebratory tone at WWDC,” Sevilla said. “It could be more of a way for Apple to recover some credibility by showing where they’re headed.”
Industry insiders would be watching to see whether Apple addresses the AI stumble or focuses on less splashy announcements, including a rumored overhaul of its operating systems for its line of devices.
“The bottom line is Apple seemed to underestimate the AI shift, then overpromised features, and is now racing to catch up,” Deepwater Asset Management LLC analysts Gene Munster and Brian Baker wrote in a note.
Rumors also include talk that Apple might add GenAI partnerships with Google or Perplexity to an OpenAI alliance announced a year ago.
Infusing its lineup with AI is only one of Apple’s challenges.
Developers, who build apps and tools to run on the company’s products, might be keen for Apple to loosen its tight control of access to iPhones.
“There’s still a lot of strife between Apple and developers,” Sevilla said. “Taking 30 percent commissions from them and then failing to deliver on promises for new functionality — that’s a double black eye.”
A lawsuit by **Fortnite** maker Epic Games Inc ended with Apple being ordered to allow outside payment systems to be used at the US App Store, but developers might want more, the analyst said.
“Apple does need to give an olive branch to the developer community, which has been long-suffering,” Sevilla said. “They can’t seem to thrive within the restrictive guardrails that Apple has been putting up for decades now.”
As AI is incorporated into Apple software, the company might need to give developers more ability to sync apps to the platform, Creative Strategies Inc analyst Carolina Milanesi said.
“Maybe with AI it’s the first time that Apple needs to rethink the open versus closed ecosystem,” Milanesi said.
While unlikely to come up at WWDC, Apple has to deal with tariffs imposed by US President Donald Trump in his trade dispute with China, a key market for sales growth, as well as the place where most iPhones are made.
Trump has also threatened to hit Apple with tariffs if iPhone production was not moved to the US, which analysts say is impossible given the costs and capabilities.
“The whole idea of having an American-made iPhone is a pipe dream; you’d have to rewrite the rules of global economics,” Sevilla said.
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