Apple “runs on Anthropic at this point” and that the AI company is powering much of what Apple does internally for product development and internal tools, according to Mark Gurman, the most influential reporter on the Apple beat.

Apple had initially pursued an AI deal with Anthropic before the Google partnership came together, but negotiations fell apart over pricing — Anthropic reportedly wanted several billion dollars per year and a doubling of fees over time. Apple’s deal with Google is costing roughly one billion dollars annually.