Apple faces allegations of outsourcing unethical data sourcing

Apple’s AI practices face scrutiny from shareholders ahead of its February 25 Annual Shareholder Meeting, with specific concerns about data privacy and partnerships with AI companies.

Key allegations: The National Legal and Policy Center (NLPC) has filed a proposal with the SEC questioning Apple’s approach to AI development and data collection practices.

• The proposal, listed as No. 4 in Apple’s 2025 proxy materials, calls for detailed reporting on AI data acquisition and ethics
• NLPC criticizes Apple for allegedly outsourcing “unethical practices” to partners while maintaining a privacy-friendly public image
• A particular focus is placed on Apple’s $25 billion partnership with Google, which represents 20% of Apple’s pretax profit

Current AI strategy: Apple has maintained a cautious approach to artificial intelligence development, emphasizing privacy and on-device processing capabilities.

• The company promotes its Private Cloud Compute model, designed to protect account data when using Apple Intelligence
• Third-party AI integration requires explicit user permission
• Apple has partnered with OpenAI’s ChatGPT and is exploring potential integration with Google’s Gemini

Specific concerns: The NLPC’s proposal highlights several areas requiring transparency and accountability.

• Risks associated with improperly obtained training data
• Privacy safeguards in AI development processes
• Compliance measures for AI-generated outputs
• The impact of partnerships with companies like Google, OpenAI, and potentially Meta on user privacy

Industry context: Apple’s position in the AI landscape differs from its competitors, who face their own challenges.

• OpenAI, Google, and Meta are currently dealing with lawsuits over alleged unauthorized data scraping
• Apple’s strategy of partnering with these companies while maintaining a privacy-focused image has drawn criticism
• The company’s approach has received praise from some analysts for cost-effectiveness in AI development

Looking ahead: While the proposal examination raises important questions about AI ethics and corporate responsibility, its immediate impact may be limited.

• The shareholder proposal is expected to fail, as Apple typically recommends against such measures
• The scrutiny highlights tensions between AI development, privacy protection, and corporate partnerships
• The debate underscores growing concerns about transparency in AI development among major tech companies

Critical perspective: The controversy highlights a potential disconnect between Apple’s privacy-first marketing and its strategic partnerships, raising questions about whether outsourcing AI development truly shields the company from ethical concerns about data collection and use.