Safari users were jolted on Wednesday as Apple (NASDAQ:AAPL) weighs embedding AI?powered search in its browser, sending Alphabet (NASDAQ:GOOG) shares tumbling about 8%.
At Google’s antitrust trial, Apple services head Eddy Cue said the company is pretty impressed by Perplexity AI’s capabilities and has begun talks to integrate it into Safari. Alternative partners under consideration include Anthropic, creator of the Claude chatbot, and OpenAI, The Wall Street Journal reported.
Cue warned that Safari search queries slipped in April for the first time in two decades, a trend with significant impact on Apple’s high?margin revenue, historically buoyed by an estimated $20 billion annual payment from Google for default search placement. That money underwrites engineers, iOS upgrades and new product development.
The shift toward generative AI assistants like ChatGPT and Claude has intensified scrutiny of Google’s search dominance. At the same trial, Alphabet CEO Sundar Pichai said he still anticipates a deal to bring Google’s Gemini AI to iPhones by midyear.
With Apple exploring AI search options, the longstanding Google?Safari pact may be poised for a dramatic rewrite.
This article first appeared on GuruFocus.