Apple locks down a $200 million A.I. investment, as the Trump administration demands keys to the iPhone’s ‘backdoor’

January 18, 2020, 2:00 PM UTC

US President Donald Trump speaks alongside Apple CEO Tim Cook during the first meeting of the American Workforce Policy Advisory Board in the State Dining Room of the White House in Washington, D.C., March 6, 2019. Photo by Saul Loeb-AFP, via Getty Images

Saul Loeb—AFP/Getty Images

While Apple was investing its cash hoard this week, the company was facing pressure from the Trump administration over its privacy policies.

Apple’s week kicked off with attorney general William Barr and President Donald Trump each calling on Apple to provide law enforcement agencies a “backdoor” to easily access encrypted data on iPhones. Apple denied the request.

Meanwhile, it was revealed this week that Apple has acquired Seattle-based artificial intelligence startup Xnor.ai. Industry experts believe Apple will use the startup’s technology to improve artificial intelligence features in future iPhone models.

Speaking of the iPhone’s future, Barclays analysts said this week that Apple has big plans for Face ID in its forthcoming devices. But in a nod to the company’s past, one of the best Apple archives ever created made its debut online this week.

For more on those headlines and others, read on for this week’s news Apple roundup:

Apple goes all-in on A.I.

Apple quietly acquired Xnor.ai this week for $200 million, GeekWire reports. Xnor.ai designed on-device artificial intelligence technology that allows devices to do their own computing on features like virtual assistants, image processing, and more. Apple’s currently uses cloud-based processing to interpret user queries and provide answers for Siri. With Xnor.ai’s help, some of that may be done on future iPhones, experts tell Fortune, reducing lag time between queries and answers. The technology could come to Apple hardware as early as 2021, they say.

Barr’s backdoor

Attorney general William Barr and President Donald Trump blasted Apple this week for not providing a “backdoor” for law enforcement to easily decrypt and access data on two iPhones owned by Mohammed Saeed Alshamrani, the shooter in the December 6 terrorist attack at a Navy base in Florida. Apple has said that backdoors create a dangerous precedent that harms user privacy. The company also said that it worked around the clock to provide assistance to federal officials investigating the attack, but Barr countered that Apple has failed to provide “substantive assistance.” Trump called on Apple to “step up to the plate.”

What can the FBI actually do?

Despite their complaints, law enforcement officials already have the ability to crack open iPhones and analyze user data. In fact, the FBI recently used a gray market hardware box called GrayKey to open an iPhone 11 Pro Max in connection with another investigation, according to Forbes. The report ignited questions over whether investigators tried using GrayKey on Alshamrani’s phones. It’s possible the Trump administration is using Alshamrani’s phones as tools to reignite the debate over iPhone encryption and Apple’s limitations on backdoors.

iPhone 12 comes into focus

Apple will release an improved Face ID in this year’s iPhone 12 lineup, Barclays analysts told investors in a research note this week. The analysts predict Apple will improve the TrueDepth 3D camera that powers FaceTime to reduce the amount of time it takes for the processor to analyze a face and allow access to the iPhone. The analysts also said Apple’s iPhone 12 lineup will also have 3D cameras on the back, allowing users to snap 3D photos from their phones. Apple did not comment on its plans for its forthcoming iPhones.

Apple Card behind the scenes

During an earnings call this week, Goldman Sachs talked about its relationship with Apple on the Apple Card credit card. Goldman CFO Stephen Scherr said Apple may “lay claim to the creation of the card,” but it’s the financial services company that ultimately makes the decisions on whether people are approved and how big of a credit limit they should have. Scherr’s comments followed questions from analysts who wondered how Goldman Sachs would handle delinquencies, collections, and other important matters, as the Apple Card’s popularity continues to grow.

Racking up a new Mac Pro

Apple is already selling its tower Mac Pro desktop, but this week, the company unveiled a rack-mounted Mac Pro version. Coming with the same high-powered features as the tower, the new Apple computer comes with rails so users can slide it into a server rack, rather than keep it on the ground or a desk. The rack-mountable Mac Pro starts at $6,499. A fully loaded version costs $54,000.

One more thing…

If you’re looking for something to do this weekend and want to explore Apple’s history, check out the new Unofficial Apple Archive. With rare video clips, photos, and more, the site provides a fascinating look at Apple’s history over the past 40 years. It’s a must-see.