This trend is reflected in second-hand market data: Research firm IDC predicts that shipments of used smartphones will reach 309.4 million in 2023, up nearly 10% from 282.6 million in 2018. For many people, a good smartphone is enough.
Apple also touts privacy as part of its generative AI package, saying Apple Intelligence is “integrated into the core of iPhone, iPad, and Mac through on-device processing.” As Axios has seen, Apple’s AI tools use large-scale language models developed by Apple, rather than relying on a collection of third-party models or LLMs. If the iPhone can’t process a user’s action or query on the device, Apple Intelligence will send the user’s data to servers running on Apple silicon, the company said, keeping the user’s personal data safe.
This raises the question: if Apple is already planning to offload some of the processing to the cloud, could the AI glow-up be available on slightly older iPhones like the iPhone 14 Pro, which has a slightly older chip?
Michael Gartenberg, a consumer technology analyst at Flash Advisory & Research who previously worked at Apple, said it’s technically impossible to say at this point whether Apple is “being dishonest about what devices this can run on.” “But we know that the iPhone can already run ChatGPT and many of Google’s AI features, so I think this is Apple waiting for an opportunity to say that the iPhone 13 just isn’t good enough,” he said.
Another question that the introduction of Apple Intelligence raises regarding iPhone sales is whether it gives consumers a reason to promote the iPhone. do not have Gartenberg said few people will buy an iPhone before this fall, slowing down the current iPhone buying cycle (assuming buyers want generative AI features; Pew Research Center polling shows Americans are more worried about generative AI than excited about it).
And because Apple Intelligence will initially only be available in U.S. English, it’s unlikely to immediately boost iPhone sales in other regions, such as China, one of Apple’s most important markets, unless Apple takes some significant “future-proofing” steps, said Carolina Milanesi, founder of research firm Heart of Tech.
“It depends on how they roll out the experience in other countries,” she said, including whether AI-generated Genmoji will be available before text editing and other language-based features. “Next year will be a bigger update cycle, with more languages added,” Milanesi predicted. And in China specifically, Apple needs to decide how to handle data storage in addition to developing language support, she said.
Either way, Apple now has a new way to entice iPhone buyers to upgrade in September, and this time it won’t just be touting a new camera crammed into the same case. It will no doubt be going all out to convince customers that the new iPhone is a much smarter smartphone, one that offers a flavor of generative AI that’s far more palatable than the AI chat platforms that are still figuring out how to apply it.
