Apple internally discusses acquisition of AI search engine Perplexity

According to Bloomberg, Apple executives have held internal discussions on acquiring Perplexity AI.

According to sources, the negotiations are still in the early stages and may not result in an acquisition agreement. Perplexity received a valuation of $14 billion in its latest round of financing. Apple may need to offer more than this figure to successfully acquire it.

San Francisco-based Perplexity operates an artificial intelligence search engine for consumers. Instead of returning a list of web pages, the service generates natural language answers to user queries. It can also visualize stock price changes, analyze user-uploaded files, and perform other tasks.

As of April last year, Perplexity had more than 15 million monthly active users, a number that may have grown significantly since then. The company recently disclosed that it processed 780 million user requests in May. In addition, its query volume has grown by 20% per month.

Perplexity generates revenue by offering two paid versions of its search engine. The first is Perplexity Pro, which provides users with inference models from vendors such as OpenAI. There is also an Enterprise Pro plan for larger organizations.

Another revenue source for Perplexity is the Sonar suite of application programming interfaces for developers. These APIs allow software teams to embed the core functionality of the company's search engine into custom applications.

Apple's vice president of corporate development, Adrian Perica, has reportedly discussed the idea of ​​acquiring Perplexity with multiple other executives. The search provider is not believed to be involved in the negotiations. However, Apple representatives have met with Perplexity executives several times recently to discuss its technology.

Meta previously tried to acquire Perplexity but failed. The Facebook parent company walked away from the deal due to disagreements on financial terms, according to Bloomberg. Meta later invested $14.3 billion in Scale AI, a provider of AI training datasets.

It is believed that Apple may ultimately decide to partner with Perplexity rather than acquire it. Such an arrangement would be significantly less expensive and less likely to be scrutinized by antitrust regulators.

The acquisition discussions come as Google's search business faces a high-profile antitrust lawsuit. Currently, the Alphabet subsidiary pays Apple billions of dollars a year to keep its search engine as the default on iOS. The lawsuit could require the two companies to end this payment arrangement. If that happens, Apple might be more inclined to work with Google competitors like Perplexity.

Perplexity isn’t the only AI startup to draw acquisition interest. Meta recently tried to acquire Safe Superintelligence, a company co-founded by former OpenAI chief scientist Ilya Sutskever, according to CNBC. After the acquisition proposal was rejected, the Facebook parent company reportedly focused on recruiting executives from the startup instead.