After a decade of continuous investments, Apple (AAPL) It is reportedly ending its effort to build the Apple Car, dubbed Project Titan.
The surprise move to close the project was announced by COO Jeff Williams and Kevin Lynch, vice president in charge of the project, on February 27, according to ai?embedded-checkout=true” rel=”noopener” onclick=”return phoenixTrackClickEvent(this, event);” target=”_blank”>Bloomberg.
Executives reportedly told the nearly 2,000 employees who were working on Project Titan that while there will be layoffs, many people will move to Apple's artificial intelligence division as the project winds down.
Apple did not immediately respond to a request for comment.
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Apple began working on the car in 2014, with plans to deliver an electric, autonomous vehicle. However, the multibillion-dollar project ran into trouble from the start, highlighted by several changes in strategy and leadership.
The decision to cancel the project was made by senior executives in recent weeks, according to Bloomberg.
The move, according to Deepwater's Gene Munster, is a “positive” for electric vehicle giant Tesla. (TSLA) .
Munster 'shocked' by death of Project Titan
Munster, responding to the report, saying that he is “shocked” by Apple's decision to end its decade-long effort to produce an autonomous vehicle.
Despite skepticism that the Apple Car will ever see the light of day, he said that “the end of the project ends optionality around a project that would have changed Apple's top-line growth from around 5% to more.” of 15%”.
If Apple had been able to perfect, manufacture and sell the Apple Car, and if the company had been able to capture 10% of the automotive market, they would have made at least $250 billion annually in revenue, increasing their overall business by 60%. , according to Münster.
However, not everything is bad; Munster said the move signals Apple's increased focus on the generative ai space, something Apple has been working on behind closed doors for months.
“While the automotive industry represents a greater long-term revenue opportunity for Apple than generative ai, the decision to leave Titan has a benefit because it will increase the company's urgency to do something deep in generative ai,” he said. “This is a positive for Tesla. I have long believed that Apple was Tesla's biggest long-term American competitor.”
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Munster: Apple 'has the ability to have the best model'
Munster told TheStreet in January that considering the importance of proprietary, proprietary data in building high-capacity generative ai models, Apple “has the ability to have the best model.”
However, he added that Apple's access to such data does not mean the company will use it. Apple's strong position on protecting the privacy of its users' data, according to Munster, will force the company to purchase user data from third parties.
For this reason, Munster stated that Apple “will be in the game,” but its model will not be the best.
He expects the company to begin previewing its generative ai efforts, which he said will likely fall under personalized ai and generative ai-enhanced Siri, in June.
But having the best model, according to Munster, is not necessary for Apple to be highly competitive in the ai space.
“The average consumer doesn't care that this is copied to GPT-3.5 when GPT-4 is available. They care if they can press a button and get what they want,” Munster said, adding that Apple's ai venture would likely It will be like the iPhone, which “has never been the best phone. It has always been the best performing phone. I think that's exactly what they're going to do.”
Kyle Morse, deputy executive director of the tech Oversight Project, saying in response to the report that “the subtext here is loud.”
“Yes, Apple is giving up on its troubled Apple Car dream amid the threat of broad antitrust enforcement, but it's just trading one potential monopoly for another: Now it's ai. Its ai projects will violate the privacy of users and will block competition.
The company has not yet revealed information about Apple's ventures in the generative ai space; It is still unknown what data their models will be trained on, how that data will be acquired, and how user data could be used.
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