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Wayne Ma, reporting for The Information:

Neither Apple nor OpenAI are paying each other to integrate
ChatGPT into the iPhone, according to a person with knowledge of
the deal. Instead, OpenAI hopes greater exposure on iPhones will
help it sell a paid version of ChatGPT, which costs around $20 a
month for individuals. Apple would take its 30% cut of these
subscriptions as is customary for in-app purchases.

Sometime in the future, Apple hopes to strike revenue-sharing
agreements with AI partners in which it gets a cut of the revenue
generated from integrating their chatbots with the iPhone,
according to Bloomberg, which first reported details of the deal.
OpenAI leaders have privately said the Apple arrangement could be
worth billions of dollars to the startup if things go well, The
Information previously reported.

I enjoy how Ma threw in a link to his own report from two weeks ago, but didn’t link to Gurman’s scoop — posted a full day before this — at Bloomberg. Classy.

 ★ 

Wayne Ma, reporting for The Information:

Neither Apple nor OpenAI are paying each other to integrate
ChatGPT into the iPhone, according to a person with knowledge of
the deal. Instead, OpenAI hopes greater exposure on iPhones will
help it sell a paid version of ChatGPT, which costs around $20 a
month for individuals. Apple would take its 30% cut of these
subscriptions as is customary for in-app purchases.

Sometime in the future, Apple hopes to strike revenue-sharing
agreements with AI partners in which it gets a cut of the revenue
generated from integrating their chatbots with the iPhone,
according to Bloomberg, which first reported details of the deal.
OpenAI leaders have privately said the Apple arrangement could be
worth billions of dollars to the startup if things go well, The
Information previously reported.

I enjoy how Ma threw in a link to his own report from two weeks ago, but didn’t link to Gurman’s scoop — posted a full day before this — at Bloomberg. Classy.

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Mark Gurman, writing at Bloomberg*:

Left unanswered on Monday: which company is paying the other as
part of a tight collaboration that has potentially lasting
monetary benefits for both. But, according to people briefed on
the matter, the partnership isn’t expected to generate meaningful
revenue for either party — at least at the outset.

The arrangement includes weaving ChatGPT, a digital assistant that
responds in plain terms to information requests, into Apple’s Siri
and new writing tools. Apple isn’t paying OpenAI as part of the
partnership, said the people, who asked not to be identified
because the deal terms are private. Instead, Apple believes
pushing OpenAI’s brand and technology to hundreds of millions of
its devices is of equal or greater value than monetary payments,
these people said.

Meanwhile, Apple, thanks to OpenAI, gets the benefit of offering
an advanced chatbot to consumers — potentially enticing users to
spend more time on devices or even splash out on upgrades.

Apple getting this free of charge, in exchange only for the prestige of showing the ChatGPT logo and credit to users of Apple devices who engage the integration, is Apple-iest negotiation in recent memory. My money says Eddy Cue, Steve Jobs’s favorite co-negotiator, made the deal. (I’d love to take Eddy Cue with me to the dealer when next I buy a car.)

During my show Tuesday night, I asked Federighi, Giannandrea, and Joswiak point blank, “So, who’s paying who in this deal?” (or something to that effect — transcript isn’t done yet), and got nothing more than smiles and shrugs in response. My read on the smiles is that they were smug happy smiles.

Ben Thompson and I recording today’s episode of Dithering — the world’s favorite 15-minute podcast — yesterday before Gurman’s report dropped, but speculating, we came to the same conclusion, that it seemed likely neither company was paying the other. It makes obvious sense from Apple’s perspective. Not so obvious from OpenAI’s. But if OpenAI’s overriding goal is to cement itself as the leader in world-knowledge LLMs — to become to chatbots what Kleenex is to facial tissues — it makes sense to agree to this just to gain users — some of whom will upgrade to paid accounts. Google, on the other hand, probably wants to be paid by Apple to integrate Gemini. But now Apple can turn to Google — and Anthropic and Mistral and whoever else wants in on this iOS and MacOS integration, like the other default search engines in Safari — and Eddy Cue can tell them “My offer is this: nothing. Not even the $20,000 for the gaming license, which I would appreciate if you would put up personally.”

Back to Gurman:

ChatGPT will be offered for free on Apple’s products, but OpenAI
and Apple could still make money by converting free users to paid
accounts. OpenAI’s subscription plans start at $20 a month — a
fee that covers extra features like the ability to analyze data
and generate more types of images.

Today, if a user subscribes to OpenAI on an Apple device via the
ChatGPT app, the process uses Apple’s payment platform, which
traditionally gives the iPhone maker a cut.

Not traditionally. Always. Apple always makes a cut. My single biggest regret from my interview Tuesday night is not thinking to ask, on stage, whether iOS and Mac users will be able to upgrade from free to paid ChatGPT accounts right in Settings, where, I presume, the ChatGPT account sign in will be. If so, Apple will surely be getting their 30/15 percent slice of that. And what’s the alternative? Sending users to OpenAI’s website where Apple would get zilch? That doesn’t sound like Apple.

* Bloomberg, of course, is the publication that published “The Big Hack” in October 2018 — a sensational story alleging that data centers of Apple, Amazon, and dozens of other companies were compromised by China’s intelligence services. The story presented no confirmable evidence at all, was vehemently denied by all companies involved, has not been confirmed by a single other publication (despite much effort to do so), and has been largely discredited by one of Bloomberg’s own sources. By all appearances “The Big Hack” was complete bullshit. Yet Bloomberg has issued no correction or retraction, and their only ostensibly substantial follow-up contained not one shred of evidence to back up their allegations. Bloomberg seemingly hopes we’ll all just forget about it. I say we do not just forget about it. Everything they publish should be treated with skepticism until they retract “The Big Hack” or provide evidence that any of it was true.

 ★ 

Mark Gurman, writing at Bloomberg*:

Left unanswered on Monday: which company is paying the other as
part of a tight collaboration that has potentially lasting
monetary benefits for both. But, according to people briefed on
the matter, the partnership isn’t expected to generate meaningful
revenue for either party — at least at the outset.

The arrangement includes weaving ChatGPT, a digital assistant that
responds in plain terms to information requests, into Apple’s Siri
and new writing tools. Apple isn’t paying OpenAI as part of the
partnership, said the people, who asked not to be identified
because the deal terms are private. Instead, Apple believes
pushing OpenAI’s brand and technology to hundreds of millions of
its devices is of equal or greater value than monetary payments,
these people said.

Meanwhile, Apple, thanks to OpenAI, gets the benefit of offering
an advanced chatbot to consumers — potentially enticing users to
spend more time on devices or even splash out on upgrades.

Apple getting this free of charge, in exchange only for the prestige of showing the ChatGPT logo and credit to users of Apple devices who engage the integration, is Apple-iest negotiation in recent memory. My money says Eddy Cue, Steve Jobs’s favorite co-negotiator, made the deal. (I’d love to take Eddy Cue with me to the dealer when next I buy a car.)

During my show Tuesday night, I asked Federighi, Giannandrea, and Joswiak point blank, “So, who’s paying who in this deal?” (or something to that effect — transcript isn’t done yet), and got nothing more than smiles and shrugs in response. My read on the smiles is that they were smug happy smiles.

Ben Thompson and I recording today’s episode of Dithering — the world’s favorite 15-minute podcast — yesterday before Gurman’s report dropped, but speculating, we came to the same conclusion, that it seemed likely neither company was paying the other. It makes obvious sense from Apple’s perspective. Not so obvious from OpenAI’s. But if OpenAI’s overriding goal is to cement itself as the leader in world-knowledge LLMs — to become to chatbots what Kleenex is to facial tissues — it makes sense to agree to this just to gain users — some of whom will upgrade to paid accounts. Google, on the other hand, probably wants to be paid by Apple to integrate Gemini. But now Apple can turn to Google — and Anthropic and Mistral and whoever else wants in on this iOS and MacOS integration, like the other default search engines in Safari — and Eddy Cue can tell them “My offer is this: nothing. Not even the $20,000 for the gaming license, which I would appreciate if you would put up personally.”

Back to Gurman:

ChatGPT will be offered for free on Apple’s products, but OpenAI
and Apple could still make money by converting free users to paid
accounts. OpenAI’s subscription plans start at $20 a month — a
fee that covers extra features like the ability to analyze data
and generate more types of images.

Today, if a user subscribes to OpenAI on an Apple device via the
ChatGPT app, the process uses Apple’s payment platform, which
traditionally gives the iPhone maker a cut.

Not traditionally. Always. Apple always makes a cut. My single biggest regret from my interview Tuesday night is not thinking to ask, on stage, whether iOS and Mac users will be able to upgrade from free to paid ChatGPT accounts right in Settings, where, I presume, the ChatGPT account sign in will be. If so, Apple will surely be getting their 30/15 percent slice of that. And what’s the alternative? Sending users to OpenAI’s website where Apple would get zilch? That doesn’t sound like Apple.

* Bloomberg, of course, is the publication that published “The Big Hack” in October 2018 — a sensational story alleging that data centers of Apple, Amazon, and dozens of other companies were compromised by China’s intelligence services. The story presented no confirmable evidence at all, was vehemently denied by all companies involved, has not been confirmed by a single other publication (despite much effort to do so), and has been largely discredited by one of Bloomberg’s own sources. By all appearances “The Big Hack” was complete bullshit. Yet Bloomberg has issued no correction or retraction, and their only ostensibly substantial follow-up contained not one shred of evidence to back up their allegations. Bloomberg seemingly hopes we’ll all just forget about it. I say we do not just forget about it. Everything they publish should be treated with skepticism until they retract “The Big Hack” or provide evidence that any of it was true.

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Timothy Snyder:

The political theory of Trump’s coup attempt is that all that
matters is the chieftain. He does not have to win an election,
because the chieftain has the right to rule simply because he is
the chieftain. Requiring Trump to win an election is thus a
provocation. The claim that he should leave office when he loses
an election justifies revenge. And of course retribution is
Trump’s platform.

The legal theory of Trump’s coup attempt, made explicit in
argument before the Supreme Court, is that the chieftain is immune
to law. There is magic around the chieftain’s person, such that he
need respond only to himself. The words “presidential immunity”
are an incantation directed to directed to people in black robes,
summoning them to act as the chieftain’s shamans and confirm his
magical status.

No issue has ever been more important in the history of the United States, and thus, in the history of democracy itself: Donald Trump lost the election in 2020 and tried, ham-fistedly, to spearhead a coup to remain in power by overthrowing the duly elected government of the nation. If he gets another chance by winning in November, the next coup won’t be as ham-fisted.

 ★ 

Timothy Snyder:

The political theory of Trump’s coup attempt is that all that
matters is the chieftain. He does not have to win an election,
because the chieftain has the right to rule simply because he is
the chieftain. Requiring Trump to win an election is thus a
provocation. The claim that he should leave office when he loses
an election justifies revenge. And of course retribution is
Trump’s platform.

The legal theory of Trump’s coup attempt, made explicit in
argument before the Supreme Court, is that the chieftain is immune
to law. There is magic around the chieftain’s person, such that he
need respond only to himself. The words “presidential immunity”
are an incantation directed to directed to people in black robes,
summoning them to act as the chieftain’s shamans and confirm his
magical status.

No issue has ever been more important in the history of the United States, and thus, in the history of democracy itself: Donald Trump lost the election in 2020 and tried, ham-fistedly, to spearhead a coup to remain in power by overthrowing the duly elected government of the nation. If he gets another chance by winning in November, the next coup won’t be as ham-fisted.

Read More 

What a photo. Reminds me of my own father, and the father I try to be myself. Impossible to imagine the former guy expressing such genuine love like this.

 ★ 

What a photo. Reminds me of my own father, and the father I try to be myself. Impossible to imagine the former guy expressing such genuine love like this.

Read More 

Ben Thompson:

So what is Apple Intelligence, then? To me the explanation flows directly from Strategy 101: Apple Intelligence is the application of generative AI to use cases and content that Apple is uniquely positioned to provide and access. It is designed, to build on yesterday’s Article, to maximize the advantages that Apple has in terms of being the operating system provider on your phone; and, on the other hand, what it is not is any sort of general purpose chatbot: that is where OpenAI comes in — and only there.

To put it another way, and in Stratechery terms, Apple is positioning itself as an AI Aggregator: the company owns users and, by extension, generative AI demand by virtue of owning its platforms, and it is deepening its moat through Apple Intelligence, which only Apple can do; that demand is then being brought to bear on suppliers who probably have to eat the costs of getting privileged access to Apple’s userbase.

It pains me to admit how great a take this is. Nailed it.

 ★ 

Ben Thompson:

So what is Apple Intelligence, then? To me the explanation flows directly from Strategy 101: Apple Intelligence is the application of generative AI to use cases and content that Apple is uniquely positioned to provide and access. It is designed, to build on yesterday’s Article, to maximize the advantages that Apple has in terms of being the operating system provider on your phone; and, on the other hand, what it is not is any sort of general purpose chatbot: that is where OpenAI comes in — and only there. […]

To put it another way, and in Stratechery terms, Apple is positioning itself as an AI Aggregator: the company owns users and, by extension, generative AI demand by virtue of owning its platforms, and it is deepening its moat through Apple Intelligence, which only Apple can do; that demand is then being brought to bear on suppliers who probably have to eat the costs of getting privileged access to Apple’s userbase.

It pains me to admit how great a take this is. Nailed it.

Read More 

Andrew Cunningham, writing at Ars Technica:

But up until now, you haven’t been able to sign into iCloud using
macOS on a VM. This made the feature less useful for developers or
users hoping to test iCloud features in macOS, or whose apps rely
on some kind of syncing with iCloud, or people who just wanted
easy access to their iCloud data from within a VM.

This limitation is going away in macOS 15 Sequoia, according to
developer documentation that Apple released yesterday. As
long as your host operating system is macOS 15 or newer and your
guest operating system is macOS 15 or newer, VMs will now be able
to sign into and use iCloud and other Apple ID-related services
just as they would when running directly on the hardware.

Nice change. Makes me wonder if this is related to Apple’s use of virtualization to allow security researchers to inspect the OS images for its Private Cloud Computer servers for Apple Intelligence.

(Via Dan Moren.)

 ★ 

Andrew Cunningham, writing at Ars Technica:

But up until now, you haven’t been able to sign into iCloud using
macOS on a VM. This made the feature less useful for developers or
users hoping to test iCloud features in macOS, or whose apps rely
on some kind of syncing with iCloud, or people who just wanted
easy access to their iCloud data from within a VM.

This limitation is going away in macOS 15 Sequoia, according to
developer documentation that Apple released yesterday. As
long as your host operating system is macOS 15 or newer and your
guest operating system is macOS 15 or newer, VMs will now be able
to sign into and use iCloud and other Apple ID-related services
just as they would when running directly on the hardware.

Nice change. Makes me wonder if this is related to Apple’s use of virtualization to allow security researchers to inspect the OS images for its Private Cloud Computer servers for Apple Intelligence.

(Via Dan Moren.)

Read More 

Max A. Cherney:

The British company, which is majority-owned by Japan’s SoftBank
Group, opens new tab, sued Qualcomm in 2022 for failing to
negotiate a new license after it acquired a new company. The suit
revolves around technology that Qualcomm, a designer of mobile
chips, acquired from a business called Nuvia that was founded by
Apple chip engineers and which it purchased in 2021 for $1.4
billion.

Arm builds the intellectual property and designs that it sells to
companies such as Apple, opens new tab and Qualcomm, which they
use to make chips. Nuvia had plans to design server chips based on
Arm licenses, but after the acquisition closed, Qualcomm
reassigned its remaining team to develop a laptop processor, which
is now being used in Microsoft’s latest AI PC, called Copilot+.

Arm said the current design planned for Microsoft’s Copilot+
laptops is a direct technical descendant of Nuvia’s chip. Arm said
it had cancelled the license for these chips.

My initial reaction when I see reports of legal disputes like this is “Eh, they’ll settle.” But look at the Apple-Masimo dispute over blood oxygen sensors — that’s still dragging on as we head into summer.

 ★ 

Max A. Cherney:

The British company, which is majority-owned by Japan’s SoftBank
Group, opens new tab, sued Qualcomm in 2022 for failing to
negotiate a new license after it acquired a new company. The suit
revolves around technology that Qualcomm, a designer of mobile
chips, acquired from a business called Nuvia that was founded by
Apple chip engineers and which it purchased in 2021 for $1.4
billion.

Arm builds the intellectual property and designs that it sells to
companies such as Apple, opens new tab and Qualcomm, which they
use to make chips. Nuvia had plans to design server chips based on
Arm licenses, but after the acquisition closed, Qualcomm
reassigned its remaining team to develop a laptop processor, which
is now being used in Microsoft’s latest AI PC, called Copilot+.

Arm said the current design planned for Microsoft’s Copilot+
laptops is a direct technical descendant of Nuvia’s chip. Arm said
it had cancelled the license for these chips.

My initial reaction when I see reports of legal disputes like this is “Eh, they’ll settle.” But look at the Apple-Masimo dispute over blood oxygen sensors — that’s still dragging on as we head into summer.

Read More 

Casey Newton, Platformer:

The question now is how polished those features will feel at release. Will the new, more natural Siri deliver on its now 13-year-old promise of serving as a valuable digital assistant? Or will it quickly find itself in a Google-esque scenario where it’s telling anyone who asks to eat rocks?

Impossible to answer at this point, given that none (or almost none?) of the Apple Intelligence features or the ChatGPT integration are enabled in the developer betas. But it feels like the answer is yes, Apple’s new AI features will err on the side of caution, at the risk of feeling pedestrian, rather than turning the “Wow” dial to its maximum setting and delivering glue-on-pizza recipes.

 ★ 

Casey Newton, Platformer:

The question now is how polished those features will feel at release. Will the new, more natural Siri deliver on its now 13-year-old promise of serving as a valuable digital assistant? Or will it quickly find itself in a Google-esque scenario where it’s telling anyone who asks to eat rocks?

Impossible to answer at this point, given that none (or almost none?) of the Apple Intelligence features or the ChatGPT integration are enabled in the developer betas. But it feels like the answer is yes, Apple’s new AI features will err on the side of caution, at the risk of feeling pedestrian, rather than turning the “Wow” dial to its maximum setting and delivering glue-on-pizza recipes.

Read More 

Zac Hall, 9to5Mac:

Earlier this year, Sandwich Vision introduced its first-ever app
with the debut of Television. The app lets you watch
content on a range of virtual TV sets that you can pin in your
real-world environment through Vision Pro.

Television supports viewing your own video files as well as
content from YouTube. You can even watch Television with friends
synchronously over spatial FaceTime on Apple Vision Pro.

Sometimes, though, you just want to enjoy a film in a proper movie
theater setting. What if you could do that for every movie? Enter
Theater: the new Apple Vision Pro app that transports you
to the perfect venue for movies.

Theater will let you experience the theatrical cinema release
feeling (even if the original Star Wars film isn’t showing at
your local movie chain). Want to watch a movie at the same time
with friends or family who can’t be together in person? Spatial
FaceTime makes that possible in Theater.

You know the immersive theater environments in Apple’s own TV app and Disney’s VisionOS app? Theater is like that, but for any video. It’s like watching YouTube on a 100-foot screen from the best seat in a cinema. I’ve been testing it, and it’s so great. I love it. And:

Sandwich is collaborating with the duo at SpatialGen, Michael Butterfield and Zachary Handshoe. See their expertise on display as they produce the first-ever stereoscopic livestream of The Talk Show Live.

The studio is also collaborating with SpatialGen to livestream
John Gruber’s The Talk Show Live in stereoscopically-captured 3D
video using high-end cameras and lenses. […]

“I started to think ‘what if John’s audience that can’t be at the
California Theater could join us anyway?’ That’s when I pitched
the idea to my co-developer, the genius Andy Roth,” Adam
[Lisagor] says. “He loved it, he found SpatialGen, and I pitched
them the idea. And we had roughly 8 weeks to make this happen, and
I can’t believe it all came together.”

Live-streaming an event and making it look good in realtime is
hard enough. But doing it in 3D video? That’s new territory,
especially considering Apple Vision Pro was just previewed at last
year’s WWDC and launched in the United States in February.

“Gruber was fascinated by the idea but a little skeptical it
could work — it just seemed too ambitious,” Lisagor adds. “The
world’s first livestreamed 3D video event? In an immersive
theater environment? Admittedly seems like a pipe dream. But
nope, it’s real.”

To be clear, the exclusive way to watch the livestream will be through Theater on Vision Pro. Murphy’s Law willing, it should be pretty cool.

 ★ 

Zac Hall, 9to5Mac:

Earlier this year, Sandwich Vision introduced its first-ever app
with the debut of Television. The app lets you watch
content on a range of virtual TV sets that you can pin in your
real-world environment through Vision Pro.

Television supports viewing your own video files as well as
content from YouTube. You can even watch Television with friends
synchronously over spatial FaceTime on Apple Vision Pro.

Sometimes, though, you just want to enjoy a film in a proper movie
theater setting. What if you could do that for every movie? Enter
Theater: the new Apple Vision Pro app that transports you
to the perfect venue for movies.

Theater will let you experience the theatrical cinema release
feeling (even if the original Star Wars film isn’t showing at
your local movie chain). Want to watch a movie at the same time
with friends or family who can’t be together in person? Spatial
FaceTime makes that possible in Theater.

You know the immersive theater environments in Apple’s own TV app and Disney’s VisionOS app? Theater is like that, but for any video. It’s like watching YouTube on a 100-foot screen from the best seat in a cinema. I’ve been testing it, and it’s so great. I love it. And:

Sandwich is collaborating with the duo at SpatialGen, Michael Butterfield and Zachary Handshoe. See their expertise on display as they produce the first-ever stereoscopic livestream of The Talk Show Live.

The studio is also collaborating with SpatialGen to livestream
John Gruber’s The Talk Show Live in stereoscopically-captured 3D
video using high-end cameras and lenses. […]

“I started to think ‘what if John’s audience that can’t be at the
California Theater could join us anyway?’ That’s when I pitched
the idea to my co-developer, the genius Andy Roth,” Adam
[Lisagor] says. “He loved it, he found SpatialGen, and I pitched
them the idea. And we had roughly 8 weeks to make this happen, and
I can’t believe it all came together.”

Live-streaming an event and making it look good in realtime is
hard enough. But doing it in 3D video? That’s new territory,
especially considering Apple Vision Pro was just previewed at last
year’s WWDC and launched in the United States in February.

“Gruber was fascinated by the idea but a little skeptical it
could work — it just seemed too ambitious,” Lisagor adds. “The
world’s first livestreamed 3D video event? In an immersive
theater environment? Admittedly seems like a pipe dream. But
nope, it’s real.”

To be clear, the exclusive way to watch the livestream will be through Theater on Vision Pro. Murphy’s Law willing, it should be pretty cool.

Read More 

My thanks to Kolide for sponsoring DF last week. Kolide’s Shadow IT report found that 47% of companies let unmanaged devices access their resources, and authenticate via credentials alone.

Even with phishing-resistant MFA, it’s frighteningly easy for bad actors to impersonate end users — in the case of the MGM hack, all it took was a call to the help desk. What could have prevented that attack (and so many others) was an un-spoofable form of authentication for the device itself.

That’s what you get with Kolide’s device trust solution: a chance to verify that a device is both known and secure before it authenticates. Kolide’s agent looks at hundreds of device properties; their competitors look at only a handful. What’s more, Kolide’s user-first, privacy-respecting approach means you can put it on machines outside MDM: contractor devices, mobile phones, and even Linux machines.

Without a device trust solution, all the security in the world is just security theater. But Kolide can help close the gaps.

 ★ 

My thanks to Kolide for sponsoring DF last week. Kolide’s Shadow IT report found that 47% of companies let unmanaged devices access their resources, and authenticate via credentials alone.

Even with phishing-resistant MFA, it’s frighteningly easy for bad actors to impersonate end users — in the case of the MGM hack, all it took was a call to the help desk. What could have prevented that attack (and so many others) was an un-spoofable form of authentication for the device itself.

That’s what you get with Kolide’s device trust solution: a chance to verify that a device is both known and secure before it authenticates. Kolide’s agent looks at hundreds of device properties; their competitors look at only a handful. What’s more, Kolide’s user-first, privacy-respecting approach means you can put it on machines outside MDM: contractor devices, mobile phones, and even Linux machines.

Without a device trust solution, all the security in the world is just security theater. But Kolide can help close the gaps.

Read More