iPhone Falls To 3rd Place In China Amid AI Features War

Recent market research reveals that the iPhone has seen a significant decline in China, slipping from the top position to third place among smartphone sales.

This change is attributed in part to Apple’s difficulties in launching its Apple Intelligence features, as the company has not yet secured authorization to implement its generative AI model within the country.

According to Canalys, the iPhone experienced a 25% decrease in shipments year-over-year during the last quarter.

Leading the market was Vivo, which claimed a 17% share and shipped 49.3 million units. In second place was Huawei, with 46.0 million units shipped, marking a remarkable 37% growth compared to last year. Apple, OPPO, and HONOR followed, each holding a 15% market share and ranking third, fourth, and fifth, respectively.

This shift means Apple’s market share dipped from 19% in 2023 to a tie for third place with Oppo and Honor in 2024, each maintaining a 15% share.

While local brands have been quick to incorporate AI features into their products, Apple continues to face challenges in establishing its own Apple Intelligence services, as noted by the Financial Times.

This data comes amid increasing competition from domestic premium smartphone manufacturers, particularly Huawei, which have benefited from a surge in nationalistic consumer preferences and their capacity to integrate AI features effectively into their offerings. Apple’s generative AI service is not currently available on the Chinese mainland.

As previously discussed, the Chinese government mandates that all generative AI models must receive governmental approval to manage the information available online. Many Western platforms are blocked by the Great Firewall of China, including Facebook, Twitter, and Wikipedia, while Google exited the Chinese market to avoid regulatory constraints.

Recently, the government indicated that launching Apple Intelligence in China would require a “challenging and lengthy process” unless Apple partners with a local AI firm. Collaborating with a Chinese company would greatly simplify the process.