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Thanks for reading The Briefing, our nightly column where we break down the day’s news. If you like what you see, I encourage you to subscribe to our reporting here.
Greetings! Forget the Musk-Trump drama for a moment. Next week is WWDC, Apple’s annual developer conference, when the iPhone maker shows off slick new software features coming later in the year. I’m tempted to say this year’s event will be more in the spotlight than usual, except that might be difficult to assert given the massive attention Apple gets for the most minor product news. And judging from this Bloomberg report today, much of what the company announces next week will qualify as minor. Even so, this year’s WWDC will be interesting. It occurs at a particularly fraught time for Apple’s relations with developers. That’s thanks to a recent court order that has forced the company—after four years of resistance—to let developers circumvent its App Store checkout and its commission of as much as 30% by sending their customers to external checkout options. As my colleague Aaron Tilley described today, developers are rushing to take advantage of the freer system. The nuance in this story, though, is that the impact of this change may not be as great as developers would hope. Many consumers so far are sticking with paying via Apple because it’s easier. If you’re about to click to buy something, do you really want to navigate out of the app to a checkout option where you might have to put in your credit card information? This is why many Wall Street analysts argued in the past that introducing outside payment options for apps wouldn’t change consumer behavior that much or hurt Apple’s revenues. Morgan Stanley provided support for that view with a report on Thursday, which cited data showing that U.S. App Store net revenue growth accelerated by nearly 2 percentage points in May from April, after Apple started allowing external payments. Given all that, why did Apple spend so much time fighting this lawsuit, initiated by Fortnite developer Epic Games? Apple’s tactics—as outlined in this court ruling in April—included delaying proceedings at one point by claiming privilege over a big chunk of documents Epic requested. After a judge found the privilege claims “to be unsubstantiated,” Apple later withdrew many of them, the ruling said. The judge finally lost patience, asserting that the court ”will not tolerate further delays.” What did Apple get out of this but a bad reputation with the courts? Its shareholders might have been better served if the company had spent less time debating legal delaying moves and more time thinking about ways of diversifying away from the iPhone. The artificial intelligence news story has evolved. Now much of the focus is around how big tech companies are succeeding in harnessing AI. We looked at that from two angles this week, one about Microsoft and the other about Alibaba. Microsoft, like smaller enterprise software firms such as Salesforce and ServiceNow, is trying to reinvent its business with its own AI agentic tools before agents from other companies disrupt its software sales. The story is worth reading. Alibaba, meanwhile, has developed its own version of open-source AI models, which are now ahead of Meta Platforms’ Llama models. That’s helping Alibaba’s cloud business, which is growing quickly but remains relatively small. Alibaba is also using its AI in its own businesses, particularly its giant commerce operations, although the impact is so far hard to discern. The story of how Alibaba’s management got its business units to embrace the homegrown models is also worth a read. On another aspect of AI, we looked at Huawei’s struggle to persuade Chinese companies to use its AI chips. The story is illuminating, given that Huawei is trying to take business from Nvidia, whose chips are now hard to get in China. Nvidia CEO Jensen Huang has warned that U.S. export controls on selling Nvidia chips in China will strengthen the Chinese chip industry. So far, though, it hasn’t worked out that way. And we broke news that Amazon was preparing to test humanoid robots, which it hopes to use to deliver parcels. The robots rely on Chinese-made tech, we revealed in a separate piece. On the AI investing front, we wrote about a wave of investment firms trying to roll up services businesses while injecting them with AI technology to improve their margins. On a different subject entirely, digital advertising, we did a deep dive on AppLovin, whose stock was one of the best performing of 2024. The app ad firm has been nipping at Google’s heels, as this story revealed, prompting a response from that company. Snap CEO Evan Spiegel, speaking at an event for The Information, explained his belief that Snap can become a force in augmented reality glasses, despite the competition from vastly bigger companies in that market. In the markets, stablecoin firm Circle went public—to a rousing reception. Here’s our analysis of the company, a must-read for anyone interested in it. Start your weekend off with our Big Read on the space startups—and bigger firms—hoping to put data centers in space.
- President Donald Trump is planning to sign another executive order extending the deadline to enforce a law to ban or force a sale of TikTok in the U.S., according to the Wall Street Journal. This will be the third time the president has pushed off the deadline, the latest of which is approaching on June 19.
- Gemini, the crypto exchange founded by billionaire twins Cameron and Tyler Winklevoss, said Friday it has filed confidentially for an initial public offering. The announcement came after Circle’s blockbuster IPO on Thursday.
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