business

6/13/24

No one is paying anyone in the OpenAI and Apple deal

It looks like the long-awaited partnership between OpenAI and Apple that was announced at the latter’s developer conference last week isn’t expected to generate revenue for either company in the near-term. Apparently no money is changing hands in the deal either, Bloomberg reports.

In exchange for letting Apple use ChatGPT technology on its iPhones, Apple is giving OpenAI a big pile of...exposure. “Apple believes pushing OpenAI’s brand and technology to hundreds of millions of its devices is of equal or greater value than monetary payments,” Bloomberg wrote, citing people familiar with the matter.

Apple gets to show off flashy new AI technology on its phones, hopefully driving more new iPhone sales. It’s less clear what OpenAI gets. Presumably both OpenAI and Apple could make money if users convert to a paid version of ChatGPT or split money from monetizing the chatbot. But for now it seems like this “deal” will only drive more costs to OpenAI.

Apple to ‘Pay’ OpenAI for ChatGPT Through Distribution, Not Cash

Apple to ‘Pay’ OpenAI for ChatGPT Through Distribution, Not Cash

In exchange for letting Apple use ChatGPT technology on its iPhones, Apple is giving OpenAI a big pile of...exposure. “Apple believes pushing OpenAI’s brand and technology to hundreds of millions of its devices is of equal or greater value than monetary payments,” Bloomberg wrote, citing people familiar with the matter.

Apple gets to show off flashy new AI technology on its phones, hopefully driving more new iPhone sales. It’s less clear what OpenAI gets. Presumably both OpenAI and Apple could make money if users convert to a paid version of ChatGPT or split money from monetizing the chatbot. But for now it seems like this “deal” will only drive more costs to OpenAI.

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Volkswagen is reportedly closing in on its own, separate tariff deal with the US

In a bid to get its own tariff rate below the 15% applied to most EU exports, Volkswagen is dangling big US investments.

Speaking at a trade show Monday, VW CEO Oliver Blume said the automaker is in advanced talks on a deal to limit its own tariff burden. Volkswagen reported a tariff cost of $1.5 billion in the first half of the year.

Speaking to Bloomberg TV, Blume said the company is in close contact with the Trump administration and has had “good talks” about its separate deal. The current 15% tariff rate on EU vehicles would still “be a burden for Volkswagen,” Blume said.

A company reaching a tariff deal separate from its home country isn’t typical, though there’s already precedent this year, with Apple’s $100 billion US investment deal amid chip tariffs and President Trump’s threats to add a levy to smartphones. Nvidia and AMD similarly struck a deal to receive the ability to sell chips in China and in exchange agreed to give the US 15% of the revenue from those sales.

15% Tariff Would Be ‘A Burden’ on Volkswagen, CEO Says

15% Tariff Would Be ‘A Burden’ on Volkswagen, CEO Says

Speaking to Bloomberg TV, Blume said the company is in close contact with the Trump administration and has had “good talks” about its separate deal. The current 15% tariff rate on EU vehicles would still “be a burden for Volkswagen,” Blume said.

A company reaching a tariff deal separate from its home country isn’t typical, though there’s already precedent this year, with Apple’s $100 billion US investment deal amid chip tariffs and President Trump’s threats to add a levy to smartphones. Nvidia and AMD similarly struck a deal to receive the ability to sell chips in China and in exchange agreed to give the US 15% of the revenue from those sales.

Lululemon sales are being squeezed — but it’s hoping sports sponsorships will save its skin

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