Why Apple wants to acquire Perplexity AI
What's the story
Apple is said to be in the early stages of internal discussions about acquiring artificial intelligence (AI) start-up Perplexity AI. The talks, led by Adrian Perica, Apple's head of mergers and acquisitions, also involve services chief Eddy Cue and senior AI executives. According to Bloomberg, these discussions are still in their infancy and may not result in an actual offer.
Strategic move
Apple's search engine ambitions
The potential acquisition of Perplexity AI could help Apple develop an AI-powered search engine. This is particularly important, as the company looks to mitigate the risk of losing its long-standing deal with Google. The partnership, which makes Google the default search engine on its devices, rakes in around $20 billion annually for Apple but is now facing scrutiny from US antitrust regulators.
Market presence
Perplexity AI's valuation and significance of potential acquisition
Perplexity AI is known for its real-time question-answering service, leveraging up-to-date information from the web. The company recently raised funds at a valuation of $14 billion, which would make any deal of that size Apple's largest acquisition ever. Apple's biggest acquisition to date was the $3 billion purchase of Beats in 2014.
Alternative strategy
Partnership with Perplexity AI also explored
Along with the acquisition talks, Apple has also explored the option of partnering with Perplexity AI. This would involve integrating Perplexity as an AI search engine option in Apple's Safari web browser and Siri. The company's AI team has been actively testing the technology, indicating a possible close relationship between the two parties.
Industry interest
Response to the acquisition talks
In response to the acquisition talks, Perplexity AI said it isn't surprised that top manufacturers want to provide "the best search and more accurate AI for their users." The company also noted that Apple has met with them several times in recent months. However, a potential deal could be complicated by an existing agreement between Perplexity and Samsung Electronics, Apple's biggest rival in smartphones.