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When Apple<\/a> Inc. Chief Executive Officer Tim Cook and his top deputies this week unveiled a landmark arrangement with OpenAI<\/a> to integrate ChatGPT into the iPhone, iPad and Mac, they were mum on the financial terms.<\/p>\n Left unanswered on Monday: which company is paying the other as part of a tight collaboration that has potentially lasting monetary benefits for both. But, according to people briefed on the matter, the partnership isn\u2019t expected to generate meaningful revenue for either party \u2014 at least at the outset.<\/p>\n The arrangement includes weaving ChatGPT, a digital assistant that responds in plain terms to information requests, into Apple\u2019s Siri and new writing tools. Apple isn\u2019t paying OpenAI as part of the partnership, said the people, who asked not to be identified because the deal terms are private. Instead, Apple believes pushing OpenAI\u2019s brand and technology to hundreds of millions of its devices is of equal or greater value than monetary payments, these people said.<\/p>\n Meanwhile, Apple, thanks to OpenAI, gets the benefit of offering an advanced chatbot to consumers \u2014 potentially enticing users to spend more time on devices or even splash out on upgrades<\/a>.<\/p>\n Representatives of Apple and OpenAI declined to comment.<\/p>\n The pact with OpenAI is part of a broader push by Apple into AI. The iPhone maker laid out the plans during a keynote address at its annual Worldwide Developers Conference, showing off AI features for the iPhone, iPad and Mac. The non-ChatGPT capabilities \u2014 branded as Apple Intelligence \u2014 were designed by the company in-house.\u00a0<\/p>\n But even if money wasn\u2019t a major factor in the Apple-OpenAI deal, remuneration could come into play later.\u00a0<\/p>\n Under the current structure, the partnership could become costly for OpenAI, which needs to pay Microsoft<\/a> Corp. to host ChatGPT on that company\u2019s Azure cloud-computing systems. The more people use ChatGPT, the more OpenAI\u2019s expenses rise. And the integration into Apple devices \u2014 while optional for users and limited to the company\u2019s recent products \u2014 threatens to add significantly to the computing budget.<\/p>\n ChatGPT will be offered for free on Apple\u2019s products, but OpenAI and Apple could still make money by converting free users to paid accounts. OpenAI\u2019s subscription plans start at $20 a month \u2014 a fee that covers extra features like the ability to analyze data and generate more types of images.\u00a0<\/p>\n Today, if a user subscribes to OpenAI on an Apple device via the ChatGPT app, the process uses Apple\u2019s payment platform, which traditionally gives the iPhone maker a cut.<\/p>\n Apple\u2019s deal with OpenAI isn\u2019t exclusive, and the iPhone maker is\u00a0already discussing offering\u00a0<\/a>Google\u2019s Gemini chatbot as an additional option. That agreement should be in place later this year.<\/p>\n Apple has also held talks with Anthropic as a potential chatbot partner, people familiar with the matter\u00a0told<\/a>\u00a0Bloomberg earlier this year. The idea is to ultimately offer a range of AI services to users \u2014 similar to the way Apple has different search engine options in its Safari browser.<\/p>\n Eventually, Apple aims to make money from AI by striking revenue-sharing agreements whereby it gets a cut from AI partners that monetize results in chatbots on Apple platforms, according to the people. The company believes that AI could chip away at the billions of dollars it gets from its Google search deal because users will favor chatbots and other tools over search engines. Apple will need to craft new arrangements that make up for the shortfall.<\/p>\n Apple\u2019s own AI services won\u2019t be as costly to deliver because most of them are handled on the devices themselves, rather than through cloud computing. Still, the company is ramping up its data center operations to support new online AI services that handle more advanced tasks.<\/p>\n To\u00a0make Apple Intelligence a success<\/a>, the company will need to expand it to other languages and countries. That may be a challenge in China, one of Apple\u2019s biggest overseas markets, where services like ChatGPT and Gemini are barred.\u00a0<\/p>\n The company has yet to reach a deal with a local Chinese provider to handle chatbot features, but has been considering an arrangement with companies such as Baidu Inc. and Alibaba Group Holding<\/a> Ltd., according to the people. For now, Apple Intelligence is only available in American English, but the company is aiming to support more languages next year.<\/p>\n<\/div>\n\nSubscribe to the Eye on AI newsletter to stay abreast of how AI is shaping the future of business. Sign up<\/a> for free.<\/div>\n