GOOG: Pixel 9
| Google hosted an event to roll out Gemini Nano powered applications on the just launched Pixel 9 smartphone. The full set of AI features to be made available in Android models to launch later this year. |
| Quick summaryGoogle rolled out a series of small but significant improvements in existing Android features powered by Gemini Nano, some new features, all of them available on Pixel 9.Nothing jumps out as a killer app, but that perhaps was not the intent.Google’s intent we suspect has been to make the overall experience more appealing – and make you switch from Apple iPhone.Many Gemini features available on existing Android models.The full experience of Gemini Nano is on Android 15 to roll out later this year.The AI features demonstrated today – many of them can be tried out today on the just launched Pixel9, says google management. |
| Apple has some catching up to doWe were aware that Apple had not rolled out SDK for Apple Intelligence at WWDC.As we wrote in our June 16th note where we raised Apple PT to $240, we noted iPhone16, at launch, would have AI apps mostly built internally at Apple; 3rd party apps to come later.According to media reports and confirmed later by Apple management, AI capabilities to be rolled out to developers ‘in waves’ during Fy25, and not prior to launch of iPhone16.Which is why we did not model our Fy25 iPhone est too aggressively. We think AI upgrade cycle at Apple is a multi-year cycle, akin to the rolling improvement in iPhone camera over many years.Apple’s valuation is based on more than just the number of devices it sells. Its valuation is justified by its decision to not use NVDA chipset, thereby sidestepping expensive infrastructure costs and the delay issues that now bedevil the likes of MSFT. |
| Google vs. AppleEven though, at launch later this year, Android 15 phone models could have a fuller AI experience than iPhone15, given Apple’s loyal customer base, we do not expect many ‘switchers’ from iPhone.Having said that, we think Google has a head start over Apple (and other hyperscale peers) in Google’s top-down approach to its own LLM, its own AI accelerators, fully owned data centers, cloud AI computing fully integrated into AI client device. |
| Google vs. MSFTIt would be interesting to watch how MSFT deals with the delay at NVDA’s Blackwell. We think investors do not appreciate the negative impact to MSFT long-term planning.Google on the other hand is master of its own AI universe. We think its plans to ramp up its next generation TPU6 silicon and its plans for AI infrastructure capacity expansion are on schedule. |