Gurman: Apple's OpenAI Lawsuit is 'Flimsy'

Mark Gurman, Bloomberg's chief correspondent on technology and Apple, joined Bloomberg Talks to discuss the tech giant's recent legal action against OpenAI. Gurman characterized Apple's lawsuit as "flimsy," suggesting its primary purpose is to create a narrative designed to scare current Apple employees considering a move to OpenAI.

Apple's Talent Drain and the OpenAI Lawsuit

Gurman elaborated on the significant talent exodus from Apple to OpenAI, noting that "400 people" have left Apple for the AI research firm. This departure rate is unprecedented in Apple's history. Gurman highlighted that OpenAI is offering compensation packages that are "3, 4, 5x what Apple is paying," combined with the allure of working on revolutionary AI technology, often framed as building the "next iPhone." He likened the situation to athletes switching teams for better contracts and more exciting opportunities.

Apple's Future Product Pipeline

Shifting to Apple's future, Gurman expressed optimism despite the company's perceived lag in the AI race. He revealed that Apple has a packed product roadmap for the next two to three years, including "three AI wearables and three AI home products." These upcoming releases are expected to be significant, ranging from smart glasses and AirPods with AI capabilities to a new smart home hub designed to be a central command center.

The full discussion can be found on Bloomberg Podcast's YouTube channel.

Gurman also touched upon the potential for a "foldable phone" from Apple, expressing excitement for such a device. He believes that Apple's core strength remains in hardware, and the integration of AI into these products will be crucial for its future success.

Siri's AI Upgrade and Investor Outlook

Addressing the current state of Apple's AI efforts, Gurman commented on the recent public beta of the new Siri AI. He noted that the upgrade has moved Siri from "completely incompetent to competent," stating that for "95% of people, the Siri in your pocket now will do absolutely what you expect." While acknowledging it's not yet on par with models like ChatGPT, he found the current iteration "terrific."

From an investor's perspective, Gurman believes Apple is well-positioned, countering the narrative that the company is falling behind in AI. He asserted that "Apple's future, the next three years, is extraordinarily strong."

Apple TV's Role as a Marketing Engine

The conversation also briefly touched on Apple's content strategy, specifically Apple TV+. Gurman explained that while shows like "Silo" may not be direct profit centers, they serve as a "marketing engine" to draw users into the Apple ecosystem. He suggested that the long-term profitability of Apple TV+ is still uncertain but acknowledged its strategic value.

The Impact of the OpenAI Lawsuit on Employees

Returning to the lawsuit, Gurman reiterated his belief that Apple's legal action is intended to influence its employees. He stated, "If you're an Apple employee and you read that lawsuit, you would have to be a lunatic to not second guess going to OpenAI." He anticipates that Apple employees will be "very scared to move between companies" following the lawsuit's framing and the threat of security repercussions.