Apple is making waves in the tech world with its recent announcement that it plans to integrate AI search options, including OpenAI and Perplexity, into its Safari browser. This move, reported by Reuters on May 8, 2025, could significantly disrupt Google’s long-held dominance as the default search engine on Apple devices.
Following the announcement, Alphabet, Google's parent company, saw its stock plummet by 7.3%, erasing approximately $150 billion in market capitalization. Meanwhile, Apple's stock also dipped slightly by 1.1% on the same day. Eddy Cue, Apple's Senior Vice President, revealed that the company is "actively considering" a redesign of Safari, noting that search volume through the browser had decreased for the first time last month as users began to turn to AI search tools.
In response, Google maintains that searches across its ecosystem continue to grow, including those from Apple devices. Google has invested around $20 billion annually to secure its position as the default search engine on Safari, which accounts for about 36% of its search ad revenue from the browser. However, the U.S. Department of Justice is proposing to prohibit Google from paying to maintain this status, a move aimed at breaking Google’s online search monopoly.
Analyst Gil Luria from DA Davidson warned that losing the default position on Apple would be a significant blow to Google, stating, "Even without additional interventions, losing that position would be a big shock for Google. If viable alternatives emerge, advertising budgets could shift away from Google significantly." In an effort to retain its users, Google has recently launched an "AI mode" on its search page and expanded its AI Overview feature to over 100 countries.
CEO Sundar Pichai mentioned during a recent antitrust hearing that Google is in talks with Apple to integrate its Gemini AI into upcoming iPhone models. This strategy aims to solidify Google’s presence within Apple’s ecosystem, which is facing increasing competition from AI-driven search tools.
As Apple moves forward with its plans to incorporate AI search providers such as OpenAI and Perplexity into Safari, experts suggest that AI content generation tools like ChatGPT are emerging as genuine competitors to traditional search engines. OpenAI has reported that its web search feature now handles over 1 billion searches weekly, boasting 400 million active users, illustrating the scale of competition Google is up against.
In addition to the search engine shake-up, Apple is currently embroiled in a legal dispute with Epic Games over changes to the App Store. A U.S. appellate court ruling requires Apple to allow developers to add links to external payment methods outside the App Store. Apple argues that this decision could result in billions of dollars in losses annually, claiming it undermines its control over its business. Epic Games plans to reintroduce Fortnite to iPhone and iPad in the U.S. soon, as they await the outcome of the appeal.
Meanwhile, Samsung has recently unveiled its S25 Edge, a super-slim smartphone featuring a 200MP camera supported by AI. This device is positioned to compete with Apple's upcoming foldable iPhone, expected to launch in 2026 with innovative features such as a nearly invisible crease and a titanium and stainless steel hinge.
In the realm of software, Google has enhanced its Gemini app for iOS, making it more user-friendly for iPad devices. The app now allows for a more comfortable user experience and includes features that integrate with Google Assistant, YouTube, Gmail, and Google Maps. The advanced version of the app, named Gemini Advanced, is available for a monthly subscription of $19.99 through Google One AI Premium.
On another front, Apple users may be eligible for compensation in a lawsuit concerning Siri's alleged recording of private conversations. The settlement, worth $95 million, allows users to claim up to $20 for each device affected, provided they can confirm that their device inadvertently recorded a private conversation. This case has its roots in a 2019 incident where contractors reportedly listened in on these conversations due to Siri being unintentionally activated.
Eddy Cue, during his testimony in the antitrust case against Google, speculated that the rapid development of AI could render the iPhone obsolete within the next decade. He suggested that wearable devices, such as AI-supported smart glasses, might eventually replace traditional smartphones.
Apple is also gearing up for the release of its iOS 18.5 update, which is set to introduce satellite connectivity features for iPhone 13 users through compatible carriers. This is particularly beneficial for users in areas lacking cellular or Wi-Fi coverage.
In the wake of these developments, Apple has reported impressive financial results for its Q2 2025 earnings call, showcasing $95.4 billion in revenue and $24.8 billion in net profit. The company highlighted strong sales in its iPhone and Mac segments, with iPhone sales reaching seasonal highs and Mac revenue growing by 6.7% year-over-year, thanks to the new M4 chip in the MacBook Air and Mac Studio.
As the tech landscape evolves with the introduction of AI technologies and ongoing legal battles, both Apple and Google are navigating a rapidly changing environment. The competition for user attention and market share is intensifying, and as AI continues to play a larger role in how people access information, the traditional search engine model may face unprecedented challenges.
