Apple’s AI gap in new iPhones disappoints users in China as Huawei threat looms By Reuters

BEIJING (Reuters) – The launch of Apple’s (NASDAQ: ) new iPhone drew scorn on Tuesday for its lack of artificial intelligence features in China, a challenge for the U.S. giant as it battles growing competition from Huawei Technologies on the biggest smartphone market in the world.

Apple on Monday unveiled its long-awaited AI-powered iPhone 16, hoping the new features will prompt consumers to upgrade amid slowing sales of smartphones, which account for more than half of all sales.

But Apple has yet to announce an AI partner in China to power the 16 models, and Apple Intelligence, the company’s AI software, won’t be available in Chinese until next year.

The launch of the iPhone 16 dominated chatter on Chinese social media on Tuesday, ahead of Huawei’s unveiling of a three-way foldable smartphone later in the day.

On Weibo (NASDAQ: ), China’s X platform, three of the top 10 trending topics were related to the iPhone 16 launch, with AI features among a key topic of discussion.

The hashtag “Chinese iPhone 16 version does not support AI yet” attracted 11.33 million views and over 1,500 comments on Weibo.

“What’s the point of buying it if you can’t use AI?” one Weibo user wrote.

Another commented: “Without AI as the biggest selling point, it should be half the price.”

The iPhone 16 and 16 Plus will cost the same as the models they replace. In China, Apple aggressively cut prices earlier this year as government restrictions on the use of foreign-brand phones and increased domestic competition hurt smartphone sales.

Other users on Weibo compared Apple’s launch to Huawei’s upcoming new phone as the Chinese firm tries to extend its lead over Apple in its home market.

“Whether iPhone 16 has AI or not doesn’t affect me, because I will buy Huawei’s three-hole phone,” wrote one Weibo user, pointing to the growing popularity of Huawei’s latest models in China, which have helped replace Apple as the no. 3 smartphones in the country in the second quarter.

But some analysts have predicted that the absence of AI features in the iPhone 16 is unlikely to have a big impact on sales in the short term.

“Chinese consumers are not yet motivated to upgrade to AI capabilities…However, in the long run, as domestic brands use AI as a key differentiator for their flagship products, it will negatively affect Apple,” said Toby Zhu, analyst at the technological market research firm Canalys.

Zhu said Apple needs to localize its offerings and quickly establish an ecosystem of AI apps and services in China to remain competitive.

Apple’s powerful operating system remains a draw for Chinese consumers, according to IDC analyst Will Wong.

“Apple’s key competitive advantage is strong customer stickiness. Thus, the replacement needs of users in the iPhone 11, 12 or 13 series could still support Apple’s sales in the absence of AI.”

“It’s still too early to say who will win,” Wong said.

Pre-orders for the new iPhone begin Friday in China through online retailers such as JD (NASDAQ:).com , with shipments starting on September 20.