Morgan Stanley: Generative AI to Land on Apple and Mac Next Year, Apple Will "Ride the Wind"

Next year, Apple will also take a ride on AI ". Morgan Stanley recently released a report that * * 2024 will be the "catalyst year" for Edge AI, and integrating AI may become Apple's "long-term ride". **This conclusion is based in part on the processing power of the IOS A17Pro chip. Analyst Erik Woodring said in the report that due to the upgrade of processing power-especially A17 Pro chip, AI work can be done on mobile phones and PC instead of cloud data centers. This AI algorithm running on edge devices (such as Internet of Things devices) is Edge AI (Edge AI). Since the data does not need to be sent to the cloud computing center or remote data center, the feedback time is higher and it can provide higher security for some sensitive data. It is reported that the A17 Pro can handle 35 trillion operations per second, which is enough power to handle "billions of single-digit participation" of large language models (LLM). In view of Apple's more than 2 billion devices, more than 1.2 billion users' data, the security of data privacy, and Apple's own leading vertical integration of hardware, software, chips and services, the report gives Apple an "overweight" rating * . Specifically, Morgan Stanley believes that Apple can ride the wind " *. -First, by hardware share. According to the report, Apple can provide an "excellent" AI user experience, resulting in an additional 12 million iPhone shipments, about $11 billion in revenue and 13-19 cents in earnings per share. -Second, users, pricing and traffic through AI services. The report points out that new users, high pricing and high traffic can all benefit Apple in the new AI services provided. -Third, through the App Store. Generative AI apps, including ChatGPT, will pay Apple a large commission. It was previously reported that Apple has expanded its spending on artificial intelligence to "millions of dollars per day" and is working to incorporate Siri into the big language model. In response, the report said it could be used as a * * "premium" Siri subscription service * *: "We estimate that if Apple charges Siri $5 per month, every 10% penetration of the iPhone installation base will increase revenue from high-profit services by more than $7 billion per year, or about 7 percentage points of service growth." Although apple seems to have been secretive about the layout of AI before, the report is very optimistic about apple's overall great development in Edge AI:> "all signs show that apple has become a leader in Edge AI, * * it's just a question of' when ', not' whether * *."