Apple Stock Dips Amid AI Advertising Controversy and Delayed Siri Update

Recently, Apple has been facing scrutiny over its AI advertising strategies. Following an investigation by the National Advertising Division (NAD), Apple removed the "Available Now" phrase from its Apple Intelligence webpage, which had previously suggested that all AI features were immediately accessible on their devices.

This action stems from NAD's findings, which determined that Apple's AI advertisements were misleading. The phrase "Available Now" initially implied that the AI features, such as priority notifications and ChatGPT integration, were ready for use with the release of iPhone 16. However, these features are being introduced in stages, from October 2024 to March of this year. NAD highlighted that the presence of these claims without clear qualifiers could mislead consumers, prompting Apple to modify its advertising content accordingly.

In response to these challenges, Apple also delayed the release of its enhanced AI-driven Siri voice assistant, which was initially advertised with advanced features like screen awareness, cross-application operations, and personalized contextual understanding. Although expected sooner, these enhancements have been pushed back and are expected to launch with iOS 19, anticipated in the fall. This delay reflects internal dissatisfaction at Apple regarding AI development progress, prompting a leadership shuffle within the company's artificial intelligence unit.

To address the situation, Apple appointed Mike Rockwell, a former Vision Pro project overseer, to head the Siri division—a move aimed at revitalizing the company's AI capabilities and aligning with Tim Cook's expectations. As part of transparency to consumers, Apple added disclaimers on their website indicating that certain advertised functionalities are still in development and will be available through future software updates.

Despite these amendments, Apple remains under legal pressure, facing multiple class-action lawsuits alleging false advertising and unfair competition practices, primarily from consumers who felt misled by the initial advertising and who argue that their purchasing decisions for iPhone 16 might have been different had they known about the incomplete AI feature rollout. Apple has responded by expressing its commitment to follow NAD's recommendations, although it maintains a differing view on some aspects of the investigation's outcomes. Nonetheless, the situation underscores ongoing challenges faced by tech giants in rapidly evolving sectors such as artificial intelligence.