Apple is weighing a big decision impacting the next iPhone release: OpenAI or Google's Gemini

• Apple is in talks with OpenAI and Google to bring AI to the next iPhone, Bloomberg reported.

• The iPhone 16 is expected to be released sometime this fall.

• Tim Cook in recent months has teased that Apple has big plans for AI coming this year.

Apple is weighing its options for bringing AI to the next-generation iPhone.

The tech giant is in talks with both OpenAI and Google to bring generative AI to iOS 18, the next iPhone operating system, but has not reached a final decision between ChatGPT and Gemini or another third-party provider, Bloomberg reported Friday.

Business Insider previously reported that the iPhone 16 is expected to be released this fall. It is set to be the first of Apple's smartphones to incorporate generative AI, which experts predict will send Apple's stock surging.

While the next iPhone could include AI-driven features based on Apple's in-house large language model, Bloomberg reports that the company plans to partner with a more established AI creator to incorporate a chatbot similar to OpenAI's GPT model.

The outlet reported that Apple had initially discussed a deal with OpenAI earlier this year, though collaboration between the two companies has slowed since then.

In recent months, CEO Tim Cook has been more outspoken about Apple's plans to dive into AI. In February, he said that big announcements would be made later this year about his company incorporating the tech into its existing product lines.

"As we look ahead, we will continue to invest in these and other technologies that will shape the future," BI previously reported he said during the company's fourth-quarter earnings call, "That includes artificial intelligence, where we continue to spend a tremendous amount of time and effort."

Apple previously announced plans to launch a Mac lineup with new M4 processors focused on AI, which led the company's stock to jump 4% despite heavy scrutiny from regulators and an antitrust lawsuit filed against the company by the DOJ in March.

The suit, combined with headwinds from China in the form of diminished sales in that key market, has created "a perfect storm for Cupertino," analyst Dan Ives wrote in an April 9 report on the company's stock. However, he noted he still believes Apple will outperform the current market return.

"Our forest through the trees view on Apple is all about navigating this next 1-2 quarters and getting on to the other side of easier comps, AI announcement at WWDC, stronger upgrade cycle for iPhone 16, and the monetization opportunity of the golden installed base in Cupertino," Ives wrote in his analysis.

Apple, Google, and OpenAI did not immediately respond to requests for comment from Business Insider.

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