AI for Students
June 21, 2025
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The AI Arms Race: Why Apple and Meta Are Circling Perplexity
Perplexity (a rising star in AI-powered search) has become the focal point of an intense acquisition chase. In June 2025, Apple explored acquiring Perplexity and earlier in the year, Meta pursued similar talks. These moves signal a critical shift in big tech’s AI strategies.
1. What Is Perplexity and Why Now?
Founded in late 2022 by AI veterans like Aravind Srinivas, Denis Yarats, Johnny Ho and Andy Konwinski, Perplexity offers a conversational search engine powered by large language models (LLMs) like GPT‑4.1, Claude, Gemini, Grok and its own Sonar model.
The platform emphasizes concise, cited answers, enhanced user experience with follow-up queries.
As of June 2025, it is valued at $14 billion after a $500 million funding round.
Perplexity processes nearly a billion queries monthly, showing explosive 20–30% M/M growth .
This rapid growth and advanced search tech make it a prime target as tech giants race to catch up in AI.
2. Apple’s Hawkish AI Strategy
Apple lagged behind in conversational AI. Siri’s limitations and delayed Siri linked AI features hurt its AI credibility.
Integrating Perplexity gives Apple a shortcut:
Replace its dependency on Google search in Safari.
Deepen Siri’s intelligence with LLM-based understanding.
Signal a serious AI commitment, especially with Apple’s antitrust scrutiny around its Google deal.
At $14 billion, Perplexity would be Apple’s largest acquisition. But that move could redefine Apple Intelligence and reshape AI competition
3. Meta’s Audacious Approach
Meta’s AI Acquisitions & Funding Frenzy:
Meta’s Mark Zuckerberg was also in serious talks to acquire Perplexity earlier this year, but ultimately chose to invest $14.8 billion in Scale AI and hire Scale’s CEO Alexandr Wang to lead a superintelligence initiative .
Meta’s strategy involves:
Buying tech for AI assistant capabilities
Acqui-hiring specialized teams (Scale AI, Thinking Machines, Safe Superintelligence).
Venturing aggressively into AI-integrated hardware (like Oakley smart glasses).
Meta’s bold $15 billion AI bet highlights the urgent demand for talent and innovation, even Google’s partnerships have cooled following the Scale deal.
4. Apple vs. Meta: Different Paths, Same Goal
| Strategy | Apple | Meta |
|---|---|---|
| Approach | Strategic acquisition (Perplexity) | Broad investments (Scale AI), buying startups |
| Goal | Power next-gen AI search & Siri | Build superintelligence and assistants |
| Talent | Add LLM + search expertise | Recruit researchers via acqui-hires |
| Hardware | Leverage iPhone/Safari/Siri | Push AR glasses with AI integration |
Apple seeks focused transformation that is retooling its core products with AI. Meta, meanwhile is constructing a broad AI foundation across services and devices.
5. Why is Perplexity the Prize?
– Key Advantages:
Citations and twin models ensure credibility and modifiable responses.
Massive valuations (now $14B) ensures scale.
Quick growth and adoption among younger users Search independence for Apple that is lower antitrust and financial risk.
– Risks & Challenges
Cost: $14 billion is steep. Comparable to Meta’s larger acquisition bets.
Regulatory scrutiny: Apple’s search switch could invite antitrust reviews.
Culture clash: Perplexity’s open model vs Apple’s guarded culture could hinder integration.
Crowded market: Competition from Google Gemini, ChatGPT, Gemini.
6. What This Means for Consumers and Competitors
– For Users:
Sharper Siri integrations, especially for search and productivity.
Safari search engines diversify beyond Google.
Meta’s assistants and wearable devices could become more intelligent.
– For Competitors:
Google faces two fronts: AI disruption and lost search revenue.
Startups may face a choice that is align with giants or pursue aggressive funding and independence.
Regulatory landscape might shift as governments watch big-tech AI tie-ups.
7. Final Takeaways
Apple’s move is a bold pivot which is from a hardware first focus to deep AI integration.
Meta’s approach shows breadth: acquiring tech and research capabilities across multiple fronts.
Perplexity stands as a firewall in the AI search wars, offering tech and talent that both giants covet.
Talent is becoming the primary asset in AI race and not just infrastructure or IP.
Consumers and competitors should brace for smarter devices, more AI-driven services and stronger privacy/regulation debates.
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