ChatGPT on iPhones unlikely to boost Apple sales in China, analysts say

Censorship requirements and local competition remain hurdles for Apple in the world’s largest smartphone market

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Apple CEO Tim Cook spoke at the company’s Worldwide Developers Conference on Monday n Cupertino, California. Photo: Getty Images via AFP

Published: 9:00pm, 11 Jun 2024

Apple’s introduction of generative artificial intelligence (AI) capabilities on iPhones and its other devices is unlikely to boost the company’s sales in China because of abundant local competition and potentially limited service availability, according to analysts.

The world’s second-largest smartphone vendor on Monday unveiled its AI blueprint during its annual Worldwide Developers Conference, detailing long-awaited new functions coming to its devices, including intelligent text generation and photo editing.

But amid uncertainties over which AI services Apple will be able to bring to mainland China’s heavily regulated market, analysts and industry insiders said the new functionalities may do little to lift battered iPhone sales in the country.

“China’s going to be tough for Apple … it’s unlikely that OpenAI will be willing to create a censored version for China,” said Rich Bishop, co-founder and chief executive at software publisher AppInChina, referring to the US start-up behind ChatGPT that provides some of the technologies supporting Apple’s latest AI endeavours.

Beijing has kept a tight lid on domestic generative AI services in China, where firms are required to follow the government’s wide-ranging censorship demands. Under a set of generative AI regulations that went into effect last August, Chinese companies need to register their relevant services with regulators and obtain permission before rolling out their AI chatbots to the public.

As of March, the Chinese government approved more than 117 generative AI services from Chinese Big Tech companies and start-ups. Similar offerings from OpenAI and other US companies, including Google and Amazon-backed Anthropic, remain officially inaccessible in the country.