Google’s parent company Alphabet (NASDAQ:Google), rose further yesterday, ending the day up 4.6%. bloomberg Apple (NASDAQ:AAPL) may be looking to Google Gemini as the AI that will be integrated into the iPhone. Indeed, Apple and Google’s potential Gemini partnership in artificial intelligence (AI) could mirror the companies’ deals in search, which have been the subject of intense regulatory scrutiny in recent years.
While Google and Apple’s AI partnership is sure to draw the ire of antitrust regulators, the move could potentially be a big win for both companies as they seek to (further) profit from the AI race. That’s what I’m looking at.
Microsoft and (NASDAQ:MSFT) Generated with OpenAI stock Apple, which is leading the way in the field of AI, has to find a way to make up for lost time on the AI front. Partnering with Google is a way for us to catch up with industry leaders like Microsoft. And with Apple now having access to one of the most powerful large-scale language models (LLMs), Google Gemini, this could be an easy way forward. Considering this, I remain bullish on both his AAPL and GOOGL.
Apple: Partnering with an AI powerhouse could be smart
I’m sure Apple could build their own LLM into their devices, but I think Google is the better option at this early stage of the AI boom. why? Although LLM has improved in recent quarters, it is still not immune to illusions (fabricated seemingly out of the blue).
Only time will tell when a robust, hallucination-free LLM will hit the market. In any case, given Apple’s history of releasing sophisticated products that are truly ready to take off, I doubt Apple will bring out his LLM products of the type they are developing.
The latest versions of Google Gemini and ChatGPT-4 Turbo are impressive in their features and impressive, but they are technically still in development, at least in my opinion.
Neither LLM is perfect, especially at this point in the AI lifecycle where hallucinations still occur regularly. My guess is that it will take some time before LLMs become sophisticated enough that mistakes are incredibly rare (or virtually impossible).
It may be several quarters or even years before we achieve the error-free AI that many of us envision as the holy grail of AI. But given the rate at which generative AI technology is advancing (think exponential rather than linear), perhaps a hallucination-free LLM is much closer than many of us think. Maybe it is.
For now, I think the public has come to accept that even the best LLMs in existence are bound to have problems from time to time. Users of such LLMs can ensure that they are not on the receiving end of hallucinations simply by checking the source itself. Admittedly, fact-checking can be a bit more cumbersome when using LLMs like Gemini or GPT-4, but it’s a relatively small compromise. Plus, it’s in between that and using an old-fashioned search engine.
What does the future hold for Google and Apple’s AI partnership?
Especially given that today’s LLMs are so prone to mistakes, negative headlines, lawsuits, public outrage, and all sorts of other negativity, Apple could actually do some good by rushing to bring LLM products to market now. I don’t think there’s anything to be gained.
However, I think that when the perfect time comes (perhaps when LLM is a bit more sophisticated), Apple could choose the option of replacing Google Gemini with its own LLM, similar to when it gave it to Intel (NASDAQ:INTC) Booting from a Mac device when it is ready to boot on its own Apple Silicon back.
In the early stages of the AI boom, Gemini allows Apple to benefit from all the positives of AI without having to deal with the negatives. If anything goes wrong, Gemini LLM is responsible, not Apple. In the meantime, look for Alphabet to gain momentum as Gemini joins Apple’s golden installed base of billions of users.
In fact, Gemini on iPhone could ultimately help Google and Apple surpass Microsoft in the LLM race. It will be interesting to see how a potential partnership between Google and Apple develops. Nevertheless, if any deal goes through, even if Alphabet is forced to pay a premium for Apple, GOOGL stock could face significant valuation expansion, perhaps leading to AI I predict it could approach the valuation of MSFT stock.
Even after soaring 4.6% in one day, GOOGL stock still seems to have room to operate at a price-to-earnings ratio of just 25.4x to catch up with MSFT stock’s 37.7x price-to-earnings ratio. .
Is GOOGL stock a buy, according to analysts?
Analysts say Alphabet stock is a “strong buy,” with 28 buys and eight hold assignments over the past three months. Alphabet’s average price target of $165.09 suggests upside potential of 12.3%.
Is AAPL stock a buy, according to analysts?
Analysts say Apple stock is a “moderate buy,” with 16 buys, nine holds, and one sell over the past three months. Apple’s average price target of $204.86 implies an upside potential of 16.3%.
conclusion
Google and Apple’s Gemini AI deal looks like a win for both companies to gain an edge in the generative AI race. However, it is important to note that we only have reports from. bloomberg Regarding potential negotiations between the two companies.
Chatter about chatter means nothing is set in stone yet, even though recent market movements suggest the dotted line has already been tied. In any case, it’s interesting to note that Apple will start looking for an AI partner as it seeks a “backstop” for the still early (and unsophisticated) stage of generative AI.
disclosure
