OpenAI is so dissatisfied with Apple over its ChatGPT integration that it didn’t achieve the subscriber numbers and visibility Apple had hoped for, that the company is now actively considering legal action against the iPhone maker, Bloomberg News reported on Thursday, citing people familiar with the matter.
According to Bloomberg, OpenAI has hired an outside law firm to consider options, which could include sending Apple a formal breach of contract notice without necessarily escalating into full-blown litigation (at least not immediately). Any legal action will likely wait until OpenAI’s ongoing court case with Elon Musk concludes.
Still, it’s a reminder of how difficult a partner Apple can be for major software companies. The iPhone is a very attractive platform for growth, but it’s completely under Apple’s control, and the companies that build on it are just guests. From Google to Adobe, Apple has a long history of showing guests the door when they’re about to get too comfortable.
TechCrunch has reached out to both OpenAI and Apple for comment.
The OpenAI partnership, announced at Apple’s Worldwide Developers Conference in June 2024, brought ChatGPT into Apple’s operating system as an option within Siri and as part of the iPhone’s Visual Intelligence feature (which allows users to use the camera to analyze their surroundings and send photos to ChatGPT along with relevant questions).
OpenAI, along with industry watchers, predicted the deal could ultimately funnel billions of dollars in new contracts and give it prime real estate in one of the world’s most used mobile ecosystems. Instead, OpenAI has become increasingly dissatisfied, complaining that integrations are buried, features are difficult to find, and revenue from partnerships is falling far short of expectations, Bloomberg reports. “They basically said, ‘OpenAI needs to take the plunge and trust us,'” one OpenAI executive told Bloomberg. “It didn’t work out.”
Apple has its own grievances, including concerns about OpenAI’s privacy standards and irritation with OpenAI’s expansion into hardware, which is led by former Apple executives, including former design chief Jony Ive, according to Bloomberg.
In any case, OpenAI isn’t the first partner Apple has regretted coming to the company with a wagon. Apple has a long history of both embracing and alienating partners. The most famous case is Google Maps, which was a flagship feature of the original iPhone. This was so central to the device’s appeal that its removal in 2012 and its replacement with Apple’s grossly inferior Apple Maps product was one of the biggest technology failures of the decade, prompting an unusual public apology from CEO Tim Cook.
At that point, friction between the two companies had been building for years, in part because Google launched Android phones a year after the iPhone debuted in 2007. The conflict only intensified after Google’s then-CEO Eric Schmidt resigned from Apple’s board in 2009.
Adobe also has scar tissue. Steve Jobs refused to support Flash on the iPhone and iPad, publishing a famous open letter in 2010 explaining why and effectively dooming the technology. Flash never regained its place on mobile.
And then there’s Spotify, which has argued for years that Apple used its control over the App Store to the detriment of rival music streaming services after launching Apple Music in 2015. The European Commission agreed and fined Apple approximately 1.8 billion euros in March 2024.
In some cases, these rifts are overcome in the name of commercial interests. Google is now Apple’s AI infrastructure partner, signing a multi-year agreement in January to power the next generation of Apple Intelligence in its Gemini model. Apple pays Google about $1 billion a year.
Meanwhile, OpenAI has also experienced some tension in its relationship recently. Elon Musk’s lawsuit accusing OpenAI of abandoning its nonprofit mission and operating in bad faith is currently in court.
The company is also reportedly pushing for greater independence ahead of its own IPO ambitions, overcoming tensions with Microsoft, its biggest backer and infrastructure partner.
If you buy through links in our articles, we may earn a small commission. This does not affect editorial independence.
