AI and Big Five: Revisited

AI and the Big Five: A 2025 Re-evaluation

In 2025, the intersection of AI and the Big Five tech companies—Apple, Google, Meta, Microsoft, and Amazon—has evolved significantly since a 2023 analysis. This re-evaluation explores the shifting dynamics, particularly Meta's struggles and the broader AI landscape.

Meta's Llama 4 release disappointed, prompting Mark Zuckerberg to recruit AI talent for a new Superintelligence lab. Despite financial incentives, hesitation persists due to Meta's AI challenges and accusations of manipulating leaderboards. Zuckerberg's vision for an AI superteam faces skepticism, with concerns over its vague concept.

The original 2023 analysis framed evaluations using Clay Christensen’s framework of sustaining versus disruptive innovation. While dire predictions about AI are unlikely, dismissing AI as hype would be a mistake. AI's impact may be overestimated in the short term but underestimated in the long term.

Apple's AI Strategy

Apple has introduced basic on-device LLM capabilities and private cloud compute infrastructure, but it lags behind in cutting-edge AI models. Its core business remains strong, with apps like OpenAI and Claude used on iPhones. Apple's local LLMs could differentiate its platforms, leveraging consumer data for AI operations.

Apple's partnership with OpenAI and focus on hardware could position it as the best provider for consumer AI. However, its integrated hardware and software approach may hinder AI innovation. Apple could invest in robotics and home automation or acquire a major AI player like Mistral to compete.

Google's AI Leadership

Google's infrastructure remains superior, enabling capabilities like Gemini's context window size and attractive pricing. However, dependence on TPUs competes with Nvidia's ecosystem. Gemini scores highly in LLM evaluations, but real-world usage lags behind OpenAI and Anthropic's models.

Google leads in media generation with Veo for video creation. Its data advantage, drawn from YouTube and web indexing, positions it strongly. Google's challenge is integrating devices, models, and consumer data to challenge Apple. AI's disruptive potential for Search threatens Google's core business, but AI Search Overviews aim to improve monetization.

Meta's AI Challenges

Meta's positioning between Apple and Google faces AI challenges, but its strategic foundation is solid. Generative AI is key to realizing returns on XR investments. However, chatbots may reduce time spent on monetized formats. Zuckerberg's recruiting efforts suggest Meta's core business is threatened, requiring new leadership.

Microsoft's AI Advantages

Microsoft's cloud service and OpenAI partnership position it strongly. Incorporating ChatGPT into Bing risks its business model, but integrating AI into productivity apps aligns with its subscription model. Microsoft's infrastructure and distribution are advantages, and deepening its relationship with alternative model providers like xAI and Mistral is crucial.

Amazon's AI Potential

Amazon's position has improved, with AWS remaining the largest cloud provider. Enterprises prefer AI close to their data, and Alexa's voice-controlled devices hold potential. Foundation model makers are critical to AI, and OpenAI leads the consumer AI space.

Foundation Model Makers

OpenAI's consumer tech focus and ChatGPT's dominance raise questions about its advertising model. Anthropic's strong developer position and reliance on Amazon's Trainium chips offer cost savings. Meta's AI investments face scrutiny, but the ultimate capabilities of LLM-based AI remain debated.