The race is on for tech's 'golden goose' — the iPhone of the AI era

• Tech companies are attempting to cash in on the AI hype by building AI-focused devices.
• Some tech leaders see the gadgets as the iPhone of the AI era, a way to own the hardware we use to interact with AI.
• A true iPhone successor could be tech's "golden goose," but past attempts have failed.

Get ready for a new wave of AI-powered tech hardware.

These cutting-edge gadgets won't look like the thin glass rectangles we've grown used to during the smartphone era — they'll take on bold new shapes as tech companies experiment with novel ways to interact with AI.

The race is on as generative AI tools like ChatGPT, OpenAI's conversational AI chatbot, take the world by storm. Tech companies are looking to cash in on the hype through new devices that incorporate AI features — a phenomenon that tech leaders are calling the "iPhone moment."

The key question they all face: Can personal AI gadgets eventually be the next big thing, replicating the tectonic shift the iPhone had on the tech industry?

Some big names seem to be betting on that.

Just last week, Mark Zuckerberg unveiled the latest generation of Meta's Ray-Bans Meta smart glasses, in which wearers can speak to the glasses through Meta AI, Meta's conversational assistant, to receive information in real-time, and use it to livestream footage across Facebook and Instagram.

"That'll be pretty wild, having Meta AI that you can just talk to all day long on your glasses," Zuckerberg told The Verge.

The AI-glasses, Zuckerberg said, are a stepping stone towards Meta's ultimate goal: a world filled with holograms you can talk to.

"You're going to interact with people as holograms, AIs as holograms, all this stuff," Zuckerberg said, referring to the vision of Meta's smart glasses.

Three days later, during a Paris Fashion Week runway show, a prototype AI pin device from the startup Humane was spotted on some of the runway models — a badge-like, wearable device that includes a camera and speaker but no screen.

Humane's cofounder, former Apple designer Imran Chaudhri, demonstrated a range of the gadget's sci-fi-like features on stage during a TED Talk in May, such as the pin's ability to project details of a call onto his hand, translate English to French in an AI-generated version of his voice, and summarize messages and calendar invites he missed using the command "catch me up."

The promise of the AI pin, Chaudhri said, is to create an invisible device that will reimagine human-technology interactions so that humans can "get back to what really matters" — "a new ability to be present."

"Why fumble for your phone when you can just hold an object and ask questions about it?" Chaudhri said in his TedX talk. "The result almost feels like the entire world becomes your operating system."

It has even been reported that Jony Ive, Apple's former design chief who led the design of the iPhone, and OpenAI CEO Sam Altman are reportedly building a dedicated AI hardware device together with "a new form factor, unconstrained by the rectangular screen."

Top-tier names also attract top-tier funding. Softbank CEO Masayoshi Son is reportedly considering pouring $1 billion into the venture.

The mysterious device hasn't been officially announced yet, but Altman told Salesforce CEO Marc Benioff that it will soon be "unthinkable to not have intelligence integrated into every product and service."

A 'Game of Thrones' battle for AI dominance

Given AI's capabilities, some tech experts believe that AI-powered personal devices could be the technology that succeeds the iPhone to become the new go-to computing device in our daily lives.

As Brad Stone, author of two books on Jeff Bezos and Amazon, recently put it: "More than 15 years after the introduction of the iPhone, ChatGPT and other generative AI services may soon form the foundation of a new kind of hardware device and an entirely different type of interaction between humans and computers."

Tech leaders may be betting big on AI hardware, in part, because hardware could play a "major role" in the evolution of AI, said Dan Ives, a technology analyst at Wedbush Securities.

"Altman, Nadella, Zuckerberg, Cook, and Jassy all know hardware will be the gateway for AI consumer tech," Ives told Insider. "Software is the hearts and lungs of AI while hardware represents the arms and legs."

In fact, Ives believes that it's "now or never" for Big Tech to capitalize on the AI arms race as this "'Game of Thrones' battle for AI dominance" is already "catalyzing major investments, partnerships, and product launches."

2024, he predicts, will be the "launching pad" year for AI.

Prying people from their iPhones will be hard

But others are a bit more skeptical on whether AI devices can one day be as popular and revolutionary as the iPhone.

"Personally, I don't find it likely that a separate category of 'AI device' will endure long-term," said Thomas Haigh, a professor at the University of Wisconsin-Milwaukee who researches the history of technology and co-authored a 2021 book titled "A New History of Modern Computing."

Haigh argues that AI is more of "a brand than anything else" — a marketing tactic, he told Insider, that companies have historically used to raise money and promote research — and iPhone users may continue to stick to the already-established gadget as Apple develops new iterations of the iPhone with AI features.

"Siri has been a core iPhone capability for a long time, and local processing of speech and other AI-branded activity have apps that justify a need for annual upgrades to smartphone hardware for several years now," Haigh said. "So in the short term, the AI trend seems more likely to reinforce the smartphone domination."

Even though the "small, light, and more energy-efficient technologies" that underlie smartphones have "opened up other product opportunities" such as smart watches with fitness tracking capabilities, he believes that personal AI devices will fail multiple times before they "eventually succeed" given the failures of some wearable devices, like Google Glass.

Ives, the technology analyst, would agree with Haigh's sentiment. Even though he said AI hardware innovations represent "the golden goose for tech players in the next decade along with software," he doesn't think all of them will be successful.

Yet, despite AI's impressive capabilities, Haigh said that smartphones may still be easier to use for the average consumer than AI devices, which means that AI personal devices may take awhile to gain public interest.

After all, there is a ChatGPT app available for iPhones and Android.

"Honestly, carrying a phone around is not such a burden and there are still going to be a lot of things that are easier to do with it than with glasses, a watch, or an earphone — however much AI fairy dust you sprinkle on them," Haigh said.

"I'd give mainstream dominance of the smartphone at least another decade."