The New Paradigm of "Coopetition" Between Apple and Google: When Soul is Injected

At the beginning of the year, an unexpected yet understandable fissure emerged in Silicon Valley's competitive landscape. On a Monday in January, Apple and Google jointly announced a multi-year cooperation agreement: Google's artificial intelligence models would become the core driver of Apple's next-generation "AI" features, starting with the voice assistant that users had joked about for years—Siri. Upon the news, the capital market reacted swiftly, with Google's parent company's market value historically surpassing the $2 trillion mark during trading, making it the fourth listed company to reach this milestone after Nvidia, Microsoft, and Apple. This is not merely a business transaction; it resembles a prism, reflecting the fundamental shift in the strategic logic of tech giants as the artificial intelligence arms race enters deeper waters: from clearly defined confrontation to complex and pragmatic "coopetition."

A belated pursuit and a shrewd compromise.

Apple's "late arrival" in the generative AI wave has become an open secret in the tech industry. When OpenAI's ChatGPT triggered a tsunami at the end of 2022, Microsoft swiftly placed its bets and integrated it, and Google pushed forward aggressively with its Gemini series of models, Apple remained unusually silent. Its internal project, codenamed "Ajax," progressed slowly, and the significantly upgraded Siri, originally slated for a debut at the 2024 Worldwide Developers Conference (WWDC), was postponed. Adding to external concerns, there were changes in Apple's senior leadership team, and its early generative AI tools received lukewarm market responses. A series of signs indicate that this giant, known for its vertical integration of hardware and software and its closed ecosystem, is facing significant challenges on the foundational large model track, which demands massive data, computing power, and rapid iteration.

The Temporary Retreat of the "In-House Development" Myth is the most striking signal of this collaboration. Apple has always regarded control over core technologies as its lifeline, from the A-series chips to the iOS operating system, and this is no exception. Choosing to outsource the "brain" of future AI experiences to Google, even if only as a foundational model supplier, marks a rare display of strategic flexibility. Analysis shows that Apple did consider other options. It reportedly held talks with leading AI companies such as OpenAI, Anthropic, and even Perplexity. Bloomberg even disclosed last fall that Apple considered paying around $10 billion annually to integrate Gemini into Siri. Ultimately, Google won this "draft" based on its technological maturity, model capabilities, and perhaps most importantly—the continuity of its existing business relationship with Apple.

For Apple, this is a shrewd compromise of "trading space for time." By partially shifting the pressure of developing the most resource-intensive and long-term investment-demanding foundational models to Google, Apple can focus its own resources more on areas where it excels: hardware integration, user experience design, privacy protection, and lightweight models that run locally on its devices. This not only accelerates the launch of its features (especially new versions), alleviating investors' concerns about its lagging progress, but also allows it to continue telling its story of "on-device intelligence" and "industry-leading privacy standards." As Dan Ives, an analyst at Wedbush Securities, put it, this is a "stepping stone" for Apple, helping to realign its strategy for 2024 and beyond.

Google's "Infrastructure" Ambitions and Ecosystem Expansion

If it can be described as "sending charcoal in snowy weather" for Apple, then for Google, this is undoubtedly "adding flowers to brocade" and a significant strategic victory. Under the competitive pressure of Microsoft gaining a first-mover advantage and tightly integrating through investments and cloud services, Google urgently needs to prove that its model is not only technologically advanced but also possesses unparalleled ecosystem influence and commercialization capabilities.

The partnership with Apple provides Google with an impeccable "benchmark client." Apple's massive installed base of over 2 billion active devices offers Gemini a potential reach scale that no single partner could previously match. This is not just another "Galaxy AI" (Samsung has adopted Gemini)-style collaboration; it directly integrates into the core of Apple's ecosystem—Siri. Although Apple emphasizes that its own AI system will continue to handle on-device tasks, Gemini will become the default "brain" for processing more complex queries requiring cloud computing power. This means that in the future, the deep interactions of hundreds of millions of users with Siri will be powered by Google's AI technology. This significantly strengthens Google's positioning as an "AI era infrastructure provider."

The confidence boost from this deal was immediate. On the day of the announcement, the market capitalization surpassed one trillion dollars, and its stock price had already risen by over % for the year. This sent a clear message to the market and regulators: in the competition, Google is not falling behind; instead, it is successfully replicating its ecosystem advantages from the search field into the domain. It is worth noting that this collaboration further deepens the multi-billion-dollar "golden link" between Apple and Google—the default search engine agreement. The U.S. Department of Justice had previously filed an antitrust lawsuit over this deal, accusing it of helping Google maintain its search monopoly. Although the judge allowed the agreement to continue, regulatory pressure persists. Now, with the collaboration agreement and the search agreement intertwined, the interests of the two giants are bound more tightly and intricately, which will undoubtedly present new challenges for future antitrust reviews. Elon Musk’s criticism of this—"Given that Google also owns and , this seems like an unreasonable concentration of power"—though stemming from his own company’s competitive stance, indeed highlights the potential risks of shifting power structures in the industry.

Strategic Squeeze from Protagonist to Supporting Roles

In this transaction, perhaps the most disappointed observer is . Just a few months ago, Apple had integrated into its devices, allowing complex questions to be forwarded to for handling when users actively choose to do so. At the time, this was seen as a cautious and open temporary solution for Apple before its self-developed models matured. However, once the multi-year core agreement with Google was announced, the role of instantly became delicate and marginal.

Apple's AI strategy presents a clear "dual-track system": Google Gemini becomes the built-in, default enhanced intelligence core layer; while OpenAI's ChatGPT is positioned as an external "expert option" that requires users to actively enable it. In the words of Pas Talsania, CEO of Equisights Research, this "pushes OpenAI into a more supportive role." For OpenAI, which aims to become a general artificial intelligence (AGI) platform and even the next-generation computing gateway, losing the opportunity for deep integration with Apple devices, the most important terminal, represents a strategic setback. Reports indicate that as early as when Google released the Gemini 3 model, OpenAI CEO Sam Altman, feeling threatened, internally issued a "code red," urging the team to accelerate development. Apple's final choice undoubtedly intensifies this competitive pressure.

This situation also highlights a key divide in the current industrial landscape: the path divergence between comprehensive giants with full-stack technology, vast cloud computing resources, and mature ecosystems (such as Google and Microsoft), and "pure" companies focused on model development (such as , ). The former can provide integrated solutions ranging from chips and cloud computing to end-user applications, making them more appealing to device manufacturers seeking stable, reliable, and scalable partnerships. While the latter may be more innovative in model development, they face greater challenges in commercial implementation, ecosystem integration, and long-term operational costs. Apple's choice, to some extent, represents a market vote between these two paths.

The Business Logic and Future Variables in the Era of "Coopetition"

The collaboration between Apple and Google goes far beyond a mere technology procurement. It profoundly reveals that in an era of extremely high technological complexity, massive investment scales, and rapidly changing competitive landscapes, the traditional either-or mindset of competition is becoming outdated. A more dynamic and layered "coopetition" relationship, based on practical interest calculations, is emerging as the new normal among industry giants.

At the smartphone operating system level, iOS and Android remain the absolute dominant players locked in a life-and-death struggle in the global market; in areas such as app stores and service ecosystems, friction between the two continues unabated. However, in the search domain, Google is Apple's "golden goose," contributing tens of billions of dollars in annual revenue; now, in the AI field, Google has become the technological "brain" behind Apple's core features. This phenomenon of fierce competition on the deck while collaborating hand-in-hand in the engine room is the ultimate manifestation of the increasing complexity of division of labor in the modern high-tech industry. Business logic triumphs over purely ideological competition. For Apple, user experience and commercial success take precedence above all else; for Google, translating its AI technology into the broadest possible influence and revenue is more important than being constrained by platform rivalry.

However, this agreement also sows the seeds for many future uncertainties. First, the issue of privacy and data sovereignty will remain a sword of Damocles. Apple has long touted "privacy as a fundamental human right," with its "Apple Intelligence" emphasizing data processing on-device or within secure "private cloud computing." Now, entrusting the core data from user interactions with Siri (even after anonymization and encryption) to Google's cloud and models presents an ongoing communication and regulatory challenge: how to clearly explain this to users and ensure its promised privacy standards are not compromised. Second, the shadow of antitrust scrutiny will only grow darker. Regulators in the US and Europe remain highly vigilant about the potential for excessive market power concentration resulting from "strong alliances" among tech giants. The search agreement is already on the table for examination; now, with the deep integration of core AI models, it is highly likely to trigger a new round of broader antitrust investigations. Finally, does this mean Apple has abandoned its ambition to develop cutting-edge large models in-house? The answer is most likely no. This multi-year agreement might simply serve as a bridge during a transitional phase, buying precious time for Apple's internal teams to catch up. Once the timing is right, Apple will likely bring core model capabilities back in-house, much like its shift from Intel chips to its own Apple Silicon in Macs.

This handshake between Apple and Google marks the opening of a new phase of competition. It is no longer a simple race for model performance leaderboards but has evolved into a comprehensive contest involving ecosystem integration capabilities, the construction of commercial partnerships, privacy governance standards, and long-term strategic endurance. Whether the infused soul can truly rejuvenate remains to be tested by the market, but one thing is certain: the rules of the power game in Silicon Valley have changed. In this new era, there are no eternal enemies nor eternal friends, only perpetual technological evolution and calculations of commercial interests.