Apple believes AI will kill Google Search… And iPhones!

Apple’s services chief Eddy Cue just dropped a bombshell in court, and it’s all about how AI might succeed where lawsuits and other tech companies haven’t.

Cue believes that AI chatbots could soon be more effective at destroying Google’s search monopoly than anything the US Justice Department or any of Google’s competitors are doing.

This came during a remedies trial following a 2023 ruling that said Google’s default search deals — like the one with Apple’s Safari — were illegal monopolistic moves.

AI chatbots are stealing the spotlight from Google Search

Cue testified that for the first time in 22 years, Apple saw a dip in Safari search volume — all thanks to people getting their answers straight from AI chatbots. Apps like ChatGPT, Perplexity, and Claude are already shifting the way people look up stuff online.

Cue says that while these models aren’t fully ready to replace Google, they’re getting better fast. And since many of them work differently from traditional search engines, they might not even need massive indexes like Google’s.

He pointed out that these new AI players are thinking outside the box. It’s not a one-size-fits-all approach anymore. With the right mix of a smart LLM and even a smaller search index, AI search tools could soon challenge Google in a big way.

Apple’s $20 billion Google deal is on the line

Despite hyping up AI’s potential, Cue made it clear that Apple’s current setup heavily benefits from Google’s payments.

The DOJ has revealed that Apple earns around $20 billion a year just for making Google the default search engine on Safari. The government wants to ban this practice, or at least make Google share its search data and possibly split from Chrome.

Cue pushed back hard. He said Apple would lose a major chunk of revenue if this deal disappeared — and they wouldn’t even get a replacement for it. Cue even admitted that Apple hasn’t made its own search engine partly because Google does it better, and the current deal works too well to walk away from.

AI might do what antitrust lawsuits can’t

Cue’s main argument? Tech evolves so quickly, it doesn’t need the government’s help to stay competitive. Just look at past tech giants like HP and Sun Microsystems.

They ruled their era, and now they’re barely relevant. “We’re not an oil company or toothpaste,” Cue said. “You may not even need an iPhone 10 years from now.”

He wrapped it all up by saying that without AI shaking things up, the court wouldn’t have much power to change the game. “People will keep using the best product — until something better comes along."