Apple nears deal to pay Google roughly US$1 billion a year for Siri AI model

For Apple, the move marks an acknowledgement that it has fallen behind in AI — and is now willing to rely on outside technology to catch up. Photo by JOSH EDELSON/AFP/Getty Images/Postmedia files

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Following an extensive evaluation period, the two companies are now finalizing an agreement that would see Apple pay roughly US$1 billion annually for access to Google’s technology, according to the people, who asked not to be identified because the deliberations are private.

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The iPhone maker is banking on Google’s help to rebuild Siri’s underlying technology, setting the stage for a new slate of features next year. The Google model’s 1.2 trillion parameters — a measure of the AI software’s complexity — would dwarf the level of Apple’s current models.

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Apple had previously mulled using other third-party models to handle the task. But after testing Gemini, OpenAI’s ChatGPT and Anthropic’s Claude, Apple zeroed in on Google earlier this year, Bloomberg reported at the time. The hope is to use the technology as an interim solution until Apple’s own models are powerful enough.

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The new Siri is on track for next spring, Bloomberg has reported. Given the launch is still months away, the plans and partnership could still evolve. Apple and Google spokespeople declined to comment.

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Shares of both companies briefly jumped to session highs on the news Wednesday. Apple’s stock gained less than one per cent to US$271.70, while Alphabet was up as much as 3.2 per cent to US$286.42.

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The custom Gemini system represents a major advance from the 150 billion parameter model used today for the cloud-based version of Apple Intelligence. The move would vastly expand the system’s power and its ability to process complex data and understand context.

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Known internally as Glenwood, the effort to fix Siri with a third-party model has been led by Vision Pro headset creator Mike Rockwell and software engineering chief Craig Federighi. The new voice assistant itself, planned for iOS 26.4, is code-named Linwood.

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Under the arrangement, Google’s Gemini model will handle Siri’s summarizer and planner functions — the components that help the voice assistant synthesize information and decide how to execute complex tasks. Some Siri features will continue to use Apple’s in-house models.

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The model will run on Apple’s own Private Cloud Compute servers, ensuring that user data remains walled off from Google’s infrastructure. Apple has already allocated AI server hardware to help power the model.

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While the partnership is substantial, it’s unlikely to be promoted publicly. Apple will treat Google as a behind-the-scenes technology supplier instead. That would make the pact different than the companies’ Safari browser deal, which made Google the default search engine.

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The agreement is also separate from earlier talks about integrating Gemini directly into Siri as a chatbot. Those discussions came close to fruition in both 2024 and earlier this year but ultimately didn’t materialize into a feature. The partnership also doesn’t weave Google AI search into Apple’s operating systems.