What Apple and Google’s Gemini deal means for both companies

For years, Apple and Google have had a will-they-won’t-they type of relationship, as far as which AI company Apple would pick to underpin its Siri virtual assistant and give it new AI-fueled personalization and agentic capabilities. Apple has spent the last year or two playing the field, reportedly considering working with OpenAI or Anthropic to support the new Siri. But in a multiyear partnership announcement worthy of a The Bachelor-style finale, Apple announced that it would live happily ever after with Google — that the company’s Gemini AI models will underpin a more personalized version of Apple’s Siri, coming sometime in 2026.

“After careful evaluation, Apple determined that Google’s Al technology provides the most capable foundation for Apple Foundation Models and is excited about the innovative new experiences it will unlock for Apple users,” Google and Apple wrote in a joint statement.

The deal allows Apple to use both Gemini AI and Google’s cloud technology to power its future frontier models and Apple Intelligence features, the companies said, adding that Apple Intelligence “will continue to run on Apple devices and Private Cloud Compute, while maintaining Apple’s industry-leading privacy standards.”

The latter point was highlighted by analysts at Morningstar, who wrote in a note on Monday that the agreement will help Apple’s reputation for security and privacy “remain intact, as it will use Gemini instances on its own servers in its own data centers via its Private Cloud Compute offering for AI processing.” The analysts added that they “expect users will be able to opt in to sharing prompts with Gemini directly, as well.”

But what does this deal actually mean for both companies? It’s not clear yet exactly how the exchange of technology will work. Is Google providing its AI models for Apple to white-label and build upon via Apple’s own AI team, or is Google going to work hand in hand with Apple to ensure a successful end product in the new Siri? We’ll see. But the fact that the company’s joint statement emphasized the “private cloud compute” of it all means that at the very least, Apple’s new deal with Google will be similar from a privacy standpoint to its deal with OpenAI in Siri. Apple will likely prompt a user for their permission before sharing anything directly with Google, William Kerwin, senior equity analyst at Morningstar, told The Verge.

On the surface, Apple and Google might appear to be rival tech giants, but the two companies have had a close, complex relationship for more than a decade. In particular, the two are connected by a mysterious longtime deal that involved Apple products featuring Google as the default search engine on its devices, which at one point was responsible for almost half of Google’s search traffic. Bruce Sewell, Apple’s former general counsel, described the idea of “co-opetition” to The New York Times, saying, “You have brutal competition, but at the same time, you have necessary cooperation.”

Google paid Apple up to $20 billion per year to maintain its position as the default search engine on Apple devices, via Apple’s Safari browser. After a drawn-out antitrust lawsuit, a federal district court judge ruled last fall that Google could continue making such payments. That remedy ruling paved the way for Monday’s announcement — and the “co-opetition” involved means both companies stand to benefit significantly, even though the rumored $1 billion-per-year payment from Apple to Google is in many ways negligible in such a high-value industry.

The comparatively low annual payment helps illustrate how mutually beneficial the partnership is: a win-win for two FAANG companies helping each other bolster the ramparts against the high-flying AI startups that could upset their longtime advantage.

“From Apple’s perspective, it’s certainly a win if you think about the pain that they’ve had in their AI strategy up to this point,” Morningstar’s Kerwin said. “The long and short of it is that they over-promised back in the summer of 2024, and they under-delivered, still, now, what they promised.” He added that the multiyear agreement means that Apple can stop investing in building up a reputation as a frontier model company and focus instead on user experience with a different company’s AI foundation, as well as finally, potentially, becoming a key player in the AI agent providers’ battle for consumer attention — which requires AI agents that are, in theory, so useful that they break into the consumer market in a new and unprecedented way.

On Google’s side of things, Kerwin said, “the win is similar to what they get with their Search in that they become, in the mind of the consumer, a de facto option as an AI model … This will give them a ton more users from the iphone user base and also really cement that brand image as a go-to AI model that supports all these features.”

Even so, experts say, the deal may end up causing the same scrutiny that Google just finished dealing with.

“I think that it was possible from the Google antitrust trial that Google could have been blocked in advance from making deals like this — [it’s] certainly a possible remedy that could’ve been on the table and was not adopted by the judge,” James Grimmelmann, a professor of digital and information law at Cornell Tech and Cornell Law School, told The Verge. Part of the government’s case in the Search trial was aimed precisely at preventing Google from making similar sweetheart AI deals, though Google largely got its way on that front.

“That’s not to say that this deal will not raise antitrust concerns, and it’s possible that some years from now Google could be facing a new antitrust trial for being the AI provider to Apple in the same way that it was facing antitrust scrutiny for being the search provider,” Grimmelmann said. “If you think back to when Google started showing up as a default search provider and these placement deals started, that was a less concentrated search market. So it could be that the market could evolve in a way that would make a deal like this more problematic over time.”

The details of the arrangement between Apple and Google aren’t quite clear yet, and those details matter from both an antitrust and an AI business standpoint, said Blake Reid, an associate professor of law at the University of Colorado Law School.

“The core concern around the Apple-Google search deal was that Apple sending such a huge volume of queries to Google would provide Google a moat by making it harder for anyone else to build a competitive search engine,” Reid said. “But is Apple going to be sending data in a similar way here? Apple’s initial statement indicates that they will use Google’s technology as more of a white-labeled technology stack that they will customize and deploy as an Apple service. If Google is only getting money from Apple, that makes the antitrust problem less obvious.”

The announcement also comes after Apple’s much-publicized trials and tribulations attempting to upgrade Siri’s AI capabilities to deliver more personalization and agentic task completion. At the company’s Worldwide Developers Conference last June, mentions of Siri were conspicuously absent, aside from the announcement that previously promised updates were running behind schedule.

“We’re continuing our work to deliver the features that make Siri even more personal,” Craig Federighi, Apple’s SVP of software engineering, said during the June event. “This work needed more time to reach our high quality bar, and we look forward to sharing more about it in the coming year.”

That time, evidently, is now. It’s been a semi-embarrassing year for Apple’s AI strategy: Apple Intelligence summaries of messages that were significantly off the mark, TV ads for new Siri features that ran last year (even though those features still haven’t arrived), and reportedly replacing longtime AI chief John Giannandrea with Mike Rockwell, who previously led Apple’s Vision Pro. So the company is turning things around with a new high-profile Google partnership and a suite of coming AI integrations with other startups.

“Apple is concerned that the rise of AI threatens to go completely around it — that it had a unique relationship with users because of its devices and its hardware-software integration, and that AI threatens to circumvent that relationship in the same way that the browser rise of the web deeply threatened Microsoft’s relationship with its users,” Cornell’s Grimmelmann said. “Apple choosing first to try to develop its own AI models and then to partner with Google here — this is its attempt to remain in that relationship and remain relevant.”

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