After multiple delays, an AI-powered version of Siri is finally on the horizon. The voice assistant, originally launched during the Steve Jobs era, is set to receive a much-needed intelligence boost—highlighting Apple's struggles to keep pace in the AI race.

**$1 Billion Deal for AI Model** According to Bloomberg's Mark Gurman, Apple has struck a deal with Alphabet to integrate a customized version of Google's Gemini AI model into Siri. The agreement will cost Apple approximately $1 billion annually. The revamped AI Siri is expected to debut in spring 2025 via the iOS 26.4 update.

This aligns with CEO Tim Cook's recent earnings call remarks confirming a spring 2025 release. Both Apple and Alphabet declined to comment, consistent with their past collaboration practices.

Notably, Apple will run the customized Gemini model on its private cloud servers while continuing to use in-house models for certain Siri functions. Simpler queries will be handled locally via Apple's own models, while complex tasks or summarization requests will automatically switch to Gemini.

Privacy remains a priority: Gemini will operate exclusively on Apple's infrastructure, with no external data sharing. This ensures user data stays isolated from Alphabet, reinforcing Apple's privacy-centric branding.

Bloomberg reports that Apple tested multiple AI models—including OpenAI's ChatGPT and Anthropic's Claude—before selecting Gemini. The decision reflects Apple's need for a reliable, privacy-compliant AI solution that can handle diverse tasks. The deal also allows flexibility to switch vendors or transition to Apple's own models in the future.

For Apple, the $1 billion annual cost is negligible given its $400 billion revenue and $100 billion profit. Meanwhile, Alphabet pays Apple $20 billion yearly to remain Safari's default search engine—a critical traffic source for Google.

**Building Its Own AI Future** The Gemini partnership is a stopgap measure. Apple is independently developing a 1-trillion-parameter AI model, though no timeline exists for deployment.

Self-reliance is core to Apple's strategy, as seen in its shift to in-house A- and M-series chips. The company only temporarily relied on Qualcomm's 5G modems due to delays in its own development—a scenario echoing its current AI challenges.

After acquiring Intel's modem division in 2019, Apple spent five years perfecting its C-series modems, now debuting in iPhone 16e and iPhone Air. A similar long-game approach may apply to AI.

**Playing Catch-Up in AI** Apple's AI delays contrast sharply with rivals. While Alphabet (Android + Gemini) and Microsoft (Windows + Copilot) aggressively advance, Apple's 2024 WWDC announcement of "Apple Intelligence" lacked substance, disappointing users and investors.

Siri, once a pioneer when launched with iPhone 4S in 2011, now lags behind Google Assistant and Amazon's Alexa. Competitors excel in contextual understanding and complex queries, while Siri remains limited to basic functions.

Apple's slow AI progress has weighed on its stock. The company trails in generative AI despite its edge in on-device machine learning for photo/voice recognition.

**Internal Struggles** Reports suggest Apple executives described Siri's repeated delays as "embarrassing." The team reportedly scrapped an unreliable initial architecture, opting for a complete rebuild.

Apple aims to launch its 1-trillion-parameter model by 2026, but the competitive landscape may have evolved further by then. Meanwhile, talent attrition hits its AI teams—two key leaders recently joined Meta amid fierce industry competition for AI experts.

Unlike peers investing heavily in acquisitions, Apple has avoided big-ticket AI deals. Its largest purchase remains the $3 billion Beats acquisition in 2013, despite sitting on massive cash reserves.

Analyst Dan Ives summarized Apple's predicament: "Their AI strategy is a train wreck. While others race ahead in F1, Apple watches from the sidelines sipping cappuccinos."

The pressure is on: If spring 2025 delivers anything short of a breakthrough, Apple risks falling irreversibly behind in the AI era.