According to reports from SCMP, there is growing concern among Chinese consumers about their ability to fully experience Apple Intelligence due to the ban on ChatGPT in China.
A report by market research company Canalys indicates that 43% of Chinese consumers have expressed high to very high interest in AI-enabled smartphones. Furthermore, 71% of these consumers are willing to pay a premium for AI features, signaling a potential opportunity for Apple to boost iPhone sales soon.
However, before introducing Apple Intelligence to the Chinese market, Apple must navigate several legal challenges. Canalys states that all AI-enabled phones sold in China must use a government-approved commercial large language model (LLM). As of March 2024, the Cyberspace Administration of China (CAC) has approved over 100 AI models from Chinese businesses, according to CNN.
Seeking to address these challenges, Apple is reportedly in urgent negotiations with a Chinese AI company to replace OpenAI before the anticipated iPhone launch in September. However, an agreement has not yet been reached, as reported by WSJ.
Nabila Popal, Senior Director of IDC Research Company, emphasized that Chinese consumers are likely to hesitate to spend over $1,000 on high-end smartphones that lack integrated AI features. In light of this, Samsung’s collaboration with Baidu to integrate the Ernie chatbot on the Galaxy S24 for the Chinese market was noted, although Baidu’s AI performance has not been well-received by users.
The decision to incorporate AI features into iOS 18 has elicited a mixed response in China. Li An, an executive at an app development studio, lauded Apple’s move, viewing it as a significant and favorable development for iOS app developers in China. On the other hand, there is disappointment expressed by many Chinese consumers regarding the limited compatibility of Apple Intelligence, which only works on specific high-end Apple devices.
Furthermore, Apple is facing tough competition from domestic smartphone companies in China. Brands such as Xiaomi, Vivo, Oppo, and Huawei have been consistently integrating AI into their devices to aid users in tasks like text composition, photo editing, call handling, and note-taking.