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Why acquiring Perplexity would be a smart move for Apple

MacDailyNews

Jul 10

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Apple is reportedly exploring a significant strategic move to bolster its artificial intelligence capabilities by engaging in early-stage discussions to acquire Perplexity AI, a fast-growing startup known for its AI-powered search engine, valued at approximately $14 billion.

This potential acquisition, which could cost Apple upwards of $30 billion according to some analysts, would mark the company’s largest-ever deal by far, greatly surpassing its $3 billion purchase of Beats Electronics in 2014. Driven by the need to catch up in the competitive AI race and reduce reliance on partnerships, Apple likely sees Perplexity’s conversational AI and real-time search technology as a transformative addition to enhance Siri and its broader ecosystem.

While no formal offer has been made, and Perplexity has stated it has “no knowledge of any current or future M&A discussions,” the reported talks signal Apple’s intent to redefine its AI strategy amid growing pressure from rivals like Google, Meta, and Microsoft.

Gene Munster for DeepWater Asset Management:
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I believe [Apple acquiring Perplexity] makes the most sense given its strategic alignment with Apple’s direction and the fact that it would allow the company to maintain full control of its AI product roadmap.
Here’s why Perplexity would be a smart move for Apple:
• Built for Integration: If Apple plans to continue building AI experiences on top of existing foundation models (like GPT-4 or Claude), Perplexity offers the ideal layer of tools to do just that. Its infrastructure is designed to work with major models rather than compete against them. This aligns well with Apple’s quiet, layered approach to AI.
• Agentic Browsing: Perplexity is working on an “agentic” AI browser called Comet, which is shaping up to be a rival to OpenAI’s Operator. If Apple were to fold this into Safari, it could transform the browser into a more intelligent AI assistant, making web navigation proactive, not just reactive.
• Reimagining Search: Perplexity’s strengths in AI search could help Apple develop a real alternative to Google Search — especially useful with the FTC potentially threatening Apple’s current multi-billion dollar default search deal with Google. This could fast-track a seamless, AI-native search experience deeply tied into the OS across all Apple devices.
• Gives more control of their AI future: Perplexity would make it easier for Apple to switch between GPT, Claude, Grok, and Gemini given its library of LLM integration tools.

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MacDailyNews Take: For a company the size of Apple, a $30 billion acquisition is easily digestible. While Apple has no history of making such an acquisition, it may be necessary after its leadership missed so badly on GenAI and with the continued floundering in its efforts to catch up. $30 billion could be a small price to pay to leap close to the front of the GenAI race, if they can move to quickly and competently integrate the Perplexity team into Apple and Perplexity’s tech into Apple products and services.

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