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Investing.com -- Apple shares (NASDAQ:AAPL) slipped 1.7% following reports from Financial Times and Wall Street Journal that OpenAI is acquiring Jony Ive’s hardware startup io Products. The move has raised concerns among investors about potential competition in consumer devices.

The acquisition, valued at approximately $6.5 billion, positions OpenAI, a company co-founded by Sam Altman, to explore alternatives to smartphones as primary AI access points. Jony Ive, renowned for his role in designing iconic Apple products such as the iPhone and MacBook, left Apple in 2019 and later founded io Products. Ive’s departure from Apple to lead creative and design efforts at OpenAI, particularly in the development of consumer devices that aim to shift users away from traditional screens, has evidently caused unease among Apple’s investors.

OpenAI’s partnership with Apple, which saw the integration of ChatGPT into Apple’s voice assistant and writing tools in December, was a significant move in what was dubbed the "Apple Intelligence" overhaul. However, the recent acquisition suggests a potential shift in the competitive landscape, with OpenAI possibly emerging as a competitor in the consumer hardware space.

The former Apple design chief’s influence at OpenAI is expected to extend across the company’s ventures, including future versions of ChatGPT, audio features, and other products. The acquisition deal, which also involved OpenAI previously acquiring a 23% stake in io, places Ive at the forefront of a new era of AI-powered devices aimed at moving consumers away from screens.

Investors’ reactions reflect the potential implications for Apple as it faces a new challenge from a company closely associated with its own AI initiatives. The acquisition underscores the evolving dynamics in the tech industry, where partnerships and competition often intersect, leading to shifts in investor sentiment.

This content was originally published on http://Investing.com