What is Perplexity, the AI startup said to be catching Meta and Apple’s attention

A burgeoning AI startup, Perplexity, has recently drawn the attention of major tech players Meta and Apple. Reports indicate that Meta engaged in discussions regarding a possible acquisition of Perplexity, although a deal was not finalized. These conversations reportedly took place in late April or early May, as highlighted by sources familiar with the matter. In a separate development, Apple is said to have had preliminary discussions about acquiring Perplexity, according to Bloomberg. However, these talks are still at an early stage and may not lead to a definitive agreement. This interest from both Apple and Meta reflects their perceived lag in the AI sector compared to competitors like Google and OpenAI, who are making significant advancements. Jesse Dwyer, Perplexity's head of communications, declined to comment on the discussions with Meta. When approached about Apple's interest, he stated, "We have no knowledge of any current or future M&A discussions involving Perplexity." Both Apple and Meta have not yet responded to requests for comments on the matter. Founded in August 2022, Perplexity offers an AI-driven search engine that curates answers by parsing web content. Users can access two search modes: quick search for general queries and pro search for more detailed responses. The free version allows three pro searches daily, while a subscription plan at $20 per month unlocks additional features, including access to multiple AI models and unlimited file uploads. Perplexity has also ventured into creating a web browser named Comet. Despite its rising popularity, the startup faces significant competition, especially from OpenAI's ChatGPT, which dominated chatbot app downloads in the third quarter of 2024. Complicating matters, Perplexity has found itself at the center of a significant controversy over content usage. The BBC has threatened legal action against the company, alleging that it copied content without authorization. Additionally, Dow Jones, which owns The Wall Street Journal and the New York Post, filed a lawsuit against Perplexity last year under similar accusations. Both Apple and Meta are keen to enhance their AI capabilities. Apple is integrating AI into key products like the iPhone, while Meta is focusing on its apps such as Instagram and WhatsApp. Recent updates from Apple included enhancements to AI tools for language translation and emoji creation. The company is also considering an AI-powered search engine for its Safari browser. However, Apple is racing against time to catch up in the AI landscape. Its revamped Siri, announced over a year ago, still awaits a release date. Meanwhile, Google, which pays Apple billions to remain the default search engine in Safari, is now facing scrutiny as part of an antitrust lawsuit. The potential acquisition of Perplexity could significantly bolster either Apple’s or Meta’s AI strategies, as both companies strive to innovate and remain relevant in a rapidly advancing technological era. Meta, in particular, has been aggressively pursuing top AI talent, with reports of signing bonuses reaching as high as $100 million. As the tech industry anticipates the transformative role AI could play—comparable to the internet and smartphones—how these companies navigate their AI developments could be crucial for their future success.