According to a report from Bloomberg, Apple (AAPL) is currently in talks with Google (GOOG, GOOGL) to use its generative AI engine, Google Gemini, in iPhones. Oppenheimer Senior Analyst of Emerging Technologies and Services Martin Yang joins Yahoo Finance to discuss the reported talks and Apple's position within the AI sector.

For the partnership to be successful for both companies, Yan states, "it will require a lot of nuance on how the large language models or gen AI functions will be implemented because it can augment search capabilities, but there are also a large number of applications it can use. One example would be simulating communication to copilot for the productivity applications from Apple, similar to Microsoft's (MSFT) implementation of copilot for its Office suite. "

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Editor's note: This article was written by Nicholas Jacobino

Video Transcript

SEANA SMITH: Apple is reportedly in talks with Google to use its generative AI engine Gemini on its iPhones. This is according to a report from Bloomberg. This comes after Apple also reportedly held conversations with OpenAI to use its product. For more on what this could mean for the tech giants and the broader industry, we want to bring in Martin Yang. He's Oppenheimer's senior analyst of emerging technologies and services. Martin, it's good to see you. So just first, your reaction to this report, and if it's true, how big of a deal this is for Apple?

MARTIN YANG: This is a very big deal for Apple because it removes the near-term concern that Apple cannot implement any GenAI functions on iPhone due to its lack of infrastructure investments relative to other large tech companies. And then, I think, it positions the iPhone, at least in the near-term, to be the go-to device to interact with large language models.

BRAD SMITH: And so additionally, Martin, when you think about the fact that Google Alphabet is going to pick up a potential win on this as well, I mean, what is it going to take for this to be successful as both of these companies would want it to be?

MARTIN YANG: I think it will require a lot of nuance on how the large language models or GenAI functions will be implemented because it can augment search capabilities, but there are also a large number of applications they can use. One example will be a similar implementation to Copilot for the productivity functions-- productivity applications from Apple similar to Microsoft implementation of Copilot for Office suite.