Benzinga·2026-01-15 08:28Core Viewpoint - Apple Inc.'s decision to outsource its AI foundation to Google is seen as a sign of significant trouble for the company, rather than a strategic advantage [1][2]. Financial Dynamics - Apple is now required to pay Google approximately $1 billion annually for AI services, reversing a previous arrangement where Google paid Apple around $20 billion per year to be the default search engine on iOS, resulting in a net loss of $21 billion for Apple [3]. Product Culture and Innovation - The partnership highlights Apple's decline in innovation and product curation, with the company lacking the internal talent to develop its own AI models [3][4]. - Current AI features from Apple have received poor user feedback, with many users disabling them due to unwanted actions [4]. Strategic Perspective - The partnership is viewed as a defensive strategy by both Apple and Google to maintain their market positions against new entrants like OpenAI, indicating a preference for established relationships over potential disruptors [5]. - While the deal may prevent immediate obsolescence for Apple, it underscores the company's loss of its status as an innovation leader [6]. Stock Performance - Apple's shares have decreased by 4.38% in 2026, although they have increased by 24.61% over the last six months and 11.44% over the past year, indicating a stronger medium to long-term price trend despite short-term weaknesses [7].