Apple’s AI Troubles Open Opportunities for China’s Smartphone Sector

Smartphone companies in China are reportedly promoting apps to help customers switch from the iPhone.

That’s according to a report Sunday (Dec. 7) by the Financial Times (FT), which characterizes this as a bid by these companies to capture market share as Apple struggles to debut artificial intelligence (AI) offerings in this massive smartphone market.

The report said the five biggest phone companies have all promoted programs this year to help consumers migrate from Apple’s operating system or to use Chinese phones alongside devices from Apple. The FT added that these efforts are happening as China’s internet regulator has held off on approving new AI features from Apple following geopolitical tensions with the U.S.

Apple in September reportedly delayed the introduction of its new, thinner smartphone, iPhone Air, in China out of a need for regulatory approval.

“Chinese smartphone vendors are clearly moving faster and with greater openness in AI development,” said Lucas Zhong, an analyst for the consultancy Omdia. “While it may take time for these strategies to deliver meaningful conversions, they will undoubtedly add pressure to Apple’s operations in China.”

The report added that smartphone providers in China have had trouble wooing Apple users because the American company makes it simple to transfer apps and files to new devices. Now, however, these companies believe their new AI-powered features, along with things like foldable phones, have made their products enticing enough to attract Apple fans.

For example, the latest model of phone from China’s Honor can help shoppers find discounts by comparing a range of coupon sites, book taxis faster by coordinating between different ride-hailing apps and generate short videos.

“Apple is a truly great company, and it’s one our entire industry should learn from, benchmark against and even surpass,” Xiangdong Li, AI product director for Honor’s Magic operating system, told the FT. “If Apple moves slowly, that presents a great opportunity for us, right?”

Meanwhile, a report last month from global market research firm Counterpoint said that Apple was on pace to overtake Samsung as the world’s largest smartphone seller, and hang onto that title through 2029.

“Beyond the highly positive market reception for the iPhone 17 series, the key driver behind the upgraded shipment outlook lies in the replacement cycle reaching its inflection point,” Counterpoint Senior Analyst Yang Wang said in a news release. “Consumers who purchased smartphones during the COVID-19 boom are now entering their upgrade phase.”