Apple and OpenAI forged a landmark partnership in 2024 to integrate ChatGPT into Siri as part of the iOS 18 update. The deal was widely hailed as a strategic move that would bring advanced conversational AI to hundreds of millions of iPhone users, giving OpenAI unprecedented access to a massive mobile user base. However, according to a detailed report from Bloomberg, the relationship has soured dramatically. OpenAI is now preparing legal action against Apple, alleging that the tech giant failed to uphold its end of the bargain.
The report, citing unnamed sources familiar with the matter, states that OpenAI’s legal team is working with an outside law firm to explore a range of options. These could culminate in sending Apple a formal notice alleging breach of contract, stopping short of a full lawsuit at the outset. The move reflects deep frustration within OpenAI over how the partnership has unfolded.
Under the agreement, ChatGPT was woven into Apple’s software ecosystem. It became a fallback option for Siri when users asked complex world-knowledge queries, and it was also embedded into Image Playground for AI-generated images and Visual Intelligence features. OpenAI executives initially believed this integration would drive a massive wave of users to subscribe to ChatGPT Plus, the premium tier. The company projected that the seamless access within iOS could generate billions of dollars per year in subscription revenue.
Yet the reality has fallen far short. The report quotes an unnamed OpenAI executive who stated, “We have done everything from a product perspective. They have not, and worse, they haven’t even made an honest effort.” The executive explained that OpenAI expected deeper integration across more Apple apps and prime placement within the Siri assistant, but Apple allegedly delivered neither. The deal’s financial structure also contributed to the tension. No money changes hands between the two companies directly; Apple receives a cut of any ChatGPT subscriptions purchased through the Settings app on iPhone. OpenAI had counted on this payment channel to be a major revenue driver, but the report says subscriptions “hasn’t come close to happening.”
OpenAI’s discontent is compounded by the fact that Apple is now preparing to introduce a next-generation Siri powered by Google Gemini at the upcoming Worldwide Developers Conference (WWDC). Furthermore, iOS 27 is expected to allow users to integrate with other AI models, including Anthropic’s Claude. While the OpenAI executive conceded that the partnership was not exclusive from the start, the company still feels burned. “Apple has so much market power that they can dictate terms,” the executive said. “We already took this leap of faith with you, and it didn’t work out well.”
The legal considerations are unfolding against a backdrop of further friction. OpenAI is actively developing its own hardware products, a project led by former Apple design chief Jony Ive. The startup has been poaching Apple engineers to work on these devices, a move that has infuriated Apple executives for over a year. This adds a personal dimension to the business conflict, as Apple’s top talent is being lured away by a partner that now threatens legal action.
From a broader perspective, the dispute highlights the complexities of partnerships between platform owners and AI developers. Apple controls the world’s most valuable mobile ecosystem, and companies like OpenAI are eager to tap into that distribution. However, the power imbalance can lead to unmet expectations. OpenAI’s experience may serve as a cautionary tale for other AI firms considering similar integrations with Apple or other dominant platforms.
The history of Apple’s AI strategy is also relevant. The company has been relatively cautious in deploying generative AI, preferring to integrate third-party models while developing its own capabilities. Siri itself has faced criticism for lagging behind competitors like Google Assistant and Amazon’s Alexa. The ChatGPT integration was seen as a way to quickly bolster Siri’s intelligence, but it seems to have fallen short of what OpenAI anticipated in terms of user engagement and revenue.
For now, no final decisions have been made. The report says OpenAI still hopes to resolve its issues with Apple outside of court. But the threat of legal action underscores the fragility of the relationship. With WWDC just weeks away, all eyes will be on Apple’s announcements regarding Siri and its AI partnerships. OpenAI’s potential lawsuit could change the dynamics of how AI companies negotiate with large platform holders, possibly leading to more formalized contracts with clear performance metrics and penalties for non-compliance.
In the interim, ChatGPT remains integrated into iOS as a helpful assistant for image generation, visual recognition, and complex Q&A. Users can still subscribe to ChatGPT Plus directly from their iPhone settings, though the revenue has disappointed OpenAI greatly. The company’s next steps will depend on Apple’s willingness to renegotiate terms or improve the integration ahead of any legal escalation. The outcome of this dispute could reshape the competitive landscape of AI in the mobile ecosystem, especially as Apple prepares to embrace multiple AI models and potentially reduce its reliance on any single partner.
Source: 9to5Mac News