{"id":519232,"date":"2026-06-26T09:24:13","date_gmt":"2026-06-26T09:24:13","guid":{"rendered":"https:\/\/www.newsbeep.com\/ie\/519232\/"},"modified":"2026-06-26T09:24:13","modified_gmt":"2026-06-26T09:24:13","slug":"apple-is-paying-google-1-billion-a-year-for-ai-heres-who-the-real-winner-is","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ie\/519232\/","title":{"rendered":"Apple Is Paying Google $1 Billion a Year for AI. Here’s Who the Real Winner Is."},"content":{"rendered":"

On Jan. 12, 2026, Apple (AAPL<\/a> 6.41%) and Alphabet (GOOGL<\/a> 0.30%) (GOOG<\/a> 0.83%) announced a deal that will see Google’s Gemini AI model power a smarter Siri. The price tag is rumored to be roughly $1 billion a year, though neither company has confirmed terms. <\/p>\n

On its face, it looks like a confirmation that Apple is painfully behind in the AI space race. I disagree. I think Apple is the winner. Here’s why.<\/p>\n

\"A<\/p>\n

Image source: Getty Images.<\/p>\n

What Google gets out of the deal<\/p>\n

Google gets a high-margin licensing fee on a model it already built, so there’s no major new spending attached. It also gets bragging rights of a sort — Apple, a company known for its obsession with quality, picked Gemini over OpenAI’s ChatGPT and Anthropic’s Claude. That means something.<\/p>\n

On the other hand, $1 billion a year is a drop in the bucket for a company with annual sales of more than $400 billion. And it’s only 5% of the payment Google makes to Apple for the privilege of remaining the default search engine on the iPhone. <\/p>\n

\"Alphabet<\/p>\n

Today’s Change<\/p>\n

(-0.30%) $-1.05<\/p>\n

Current Price<\/p>\n

$344.24<\/p>\n

Key Data Points<\/p>\n

Market Cap<\/p>\n

$4.2T<\/p>\n

Day’s Range<\/p>\n

$335.85 – $345.57<\/p>\n

52wk Range<\/p>\n

$171.73 – $408.61<\/p>\n

Volume<\/p>\n

1.7M<\/p>\n

Avg Vol<\/p>\n

30.6M<\/p>\n

Gross Margin<\/p>\n

60.43%<\/p>\n

Dividend Yield<\/p>\n

0.25%<\/p>\n

Why the real power stays with Apple<\/p>\n

The disparity here is revealing. If Google lost that default search slot, it would be locked out of the search traffic from more than 1.5 billion of the most valuable devices on earth — a gut punch to its core business. If, on the other hand, Apple swapped Gemini out for OpenAI’s GPT, Anthropic’s Claude<\/a>, or even China’s DeepSeek, the average iPhone owner would likely not notice. <\/p>\n

It shows that AI models are more or less a commodity — an interchangeable part Apple can shop for and replace, while Apple’s hold on its customers is anything but.<\/p>\n

\"Apple<\/p>\n

Today’s Change<\/p>\n

(-6.41%) $-18.78<\/p>\n

Current Price<\/p>\n

$274.30<\/p>\n

Key Data Points<\/p>\n

Market Cap<\/p>\n

$4.3T<\/p>\n

Day’s Range<\/p>\n

$273.77 – $288.73<\/p>\n

52wk Range<\/p>\n

$199.26 – $317.40<\/p>\n

Volume<\/p>\n

5.9M<\/p>\n

Avg Vol<\/p>\n

48.8M<\/p>\n

Gross Margin<\/p>\n

47.86%<\/p>\n

Dividend Yield<\/p>\n

0.38%<\/p>\n

Siri gets smarter without Apple footing the R&D bill<\/p>\n

Internal evaluations reportedly showed Siri flubbing complex requests about a third of the time. It’s clear that by incorporating Gemini, Apple will be able to greatly improve its products and the user experience.<\/p>\n

Apple needed a fix, and it got it. $1 billion a year isn’t cheap, but it pales in comparison to the investment Google has pumped into developing Gemini. Apple gets an immediate fix while it works to perfect its own in-house model.<\/p>\n

And — in stark contrast to the rest of big tech — it does this with remarkable discipline. Apple’s AI capital spending in 2025 was about $12.7 billion. Alphabet spent roughly $90 billion. <\/p>\n

In my view, Apple has positioned itself<\/a> perfectly to reap the rewards of state-of-the-art AI without most of the cost of creating it. So, while many people say Apple is falling behind in AI, I say it’s right where it needs to be. I think this deal confirms it.<\/p>\n","protected":false},"excerpt":{"rendered":"On Jan. 12, 2026, Apple (AAPL 6.41%) and Alphabet (GOOGL 0.30%) (GOOG 0.83%) announced a deal that will…\n","protected":false},"author":2,"featured_media":519233,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[61,60,80],"class_list":["post-519232","post","type-post","status-publish","format-standard","has-post-thumbnail","category-technology","tag-ie","tag-ireland","tag-technology"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/519232","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=519232"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/519232\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/519233"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=519232"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=519232"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=519232"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}