The news: This week’s Apple Worldwide Developers Conference (WWDC) will be a critical opportunity for Apple to define its AI transformation after a year of missteps, unfulfilled promises, and user fallout. 

The company’s AI transition has been fraught with delays, resulting in questions on Apple’s credibility and its ability to compete with the likes of Google, Meta, and Microsoft in productizing AI for businesses and consumers. 

As Apple’s former design star Jony Ive and other ex-employees help shape the next big thing—an AI wearable with OpenAI—outside Cupertino, pressure mounts for Apple to respond.

Some likely solutions: Apple has options that don’t require immediate internal AI advancements.

• Focus on hardware. The company might take a gap year to refine its AI tools and could instead lean on developers and partners to showcase why Apple’s hardware, still its crown jewel, is the best for AI workflows. Developers showcasing AI apps and services running on Apple devices keeps the company in the mix.
• Acquire AI firms. Apple could acqui-hire any of the startups spun out by ex-OpenAI founders. Of these, Mira Murati’s Thinking Machines or Ilya Sutskever’s Safe Superintelligence (SSI) could be plug-and-play additions to Apple’s efforts.
• Outsource AI. The company could lean on the likes of Google’s Gemini, Perplexity, or Anthropic’s Claude and integrate these directly into iOS as alternatives to Siri and its ChatGPT integration, although promoting a competitor’s product might be seen as acknowledgement of its own shortcomings.

Our take: Apple must convince users and developers that its platform is where meaningful AI happens. Leaning solely on OS and service updates won’t cut it, and ignoring its AI roadmap risks slowing iPhone and Mac upgrade cycles.

The pressure is mounting. Samsung and Google are packing AI into their next phones, and 1 in 5 iPhone users say AI features could drive their next smartphone upgrade, per CNET.