OpenAI, the creator of ChatGPT, held its “Spring Update” event on Monday, where it unveiled a new desktop app, an updated web interface, and its most sophisticated system to date, GPT-4. The demonstration showed how personal computers and smartphones, starting with those made by Apple (NASDAQ:AAPL), could improve with the use of artificial intelligence. The demonstration combined speech, typing, and visual input to show how AI could improve performance.
A significant portion of the demonstration used Apple iPhones, which were directly connected to the demonstration device, to minimize the delay in interactive responses. In this regard, financial analysts at Bank of America maintained a positive outlook on Apple shares, expressing the expectation that the technology company will benefit greatly from the implementation of artificial intelligence in its devices, with the potential to increase profit margins and continue to grow in the services sector.
Sam Altman, CEO of OpenAI, claimed in a blog post that his organization has developed “the highest quality system available for free in ChatGPT, without ads or similar features.” “This suggests that OpenAI may find alternative ways to generate revenue and is unlikely to replicate Apple’s monetization business model through licensing agreements with companies like Google, although such partnerships are not entirely out of the question,” Bank of America analysts noted.
Furthermore, they point out that OpenAI's GPT-4 system is capable of handling up to 1 trillion parameters, a significant increase from GPT-3's 175 billion parameters. While devices can handle 7 to 10 billion parameters, the most comprehensive AI experiences are delivered through cloud-based services, Bank of America analysts note. They also mention that potential revenue streams for AI platforms like OpenAI could come from advertising, subscription services, or digital marketplace models that generate revenue from third-party developers who create AI-powered apps. Currently, Apple's voice assistant, Siri, processes information on the device itself and also sends data to Apple's servers for additional processing.
Bank of America analysts also noted that the demonstration did not provide specific details on actual delays in response times or confirm whether the devices’ processing power and network speeds were adequate for the intended use. “In our view, Apple is likely to increase the local computing power in the iPhone 16, possibly including more memory, which could lead to better performance than previous models and spur consumer upgrades.”
Source: Investing
