To date, AI products have been failures. Apple aims to change the status quo | Real Time Headlines

In late 2022, OpenAI’s launch of ChatGPT sparked interest in the possibilities of artificial intelligence.

Within months, some of the world’s largest tech companies, including Microsoft, Yuan and Googlejoined the party and launched its own AI chatbot and generative AI tools. By the end of 2023, NVIDIA It turns out that it is the only company in the world that can make huge profits by providing these services.

Fast forward to 2024, and a big theme in artificial intelligence involves our consumers’ favorite gadgets, with technology companies trying to bring artificial intelligence to phones and laptops.

Earlier this year, Samsung launched its artificial intelligence-powered Galaxy S24 smartphone. Microsoft partners with the following companies Dell, HP and QualcommA new artificial intelligence computer called the Copilot+ PC will go on sale this summer. A few weeks ago, Google launched the Pixel 9 series of AI phones.

So far, these new devices have been underwhelming. Rather than creating an entirely new experience, they’re introducing features that make it easier to edit photos, talk to chatbots, or provide instant subtitles for videos. There’s also Humane’s AI Pin, a clip-on gadget that launched in May and became an instant hit. Pan in the comments. By August, Report It turns out that daily returns exceed sales.

apple Will try to change the narrative.

On September 9, the company is expected to show off its new iPhone lineup, which includes artificial intelligence features announced in June. The system, called Apple Intelligence, will be launched in the coming months. It can also be accessed by current Apple devices like the iPhone 15 Pro, as well as some newer iPads and Macs.

But Apple smartphones will be free. So the company needs to convince hundreds of millions of iPhone customers that it’s time to upgrade.

That’s what Wall Street will be paying attention to when the latest iPhone launches this month. Will Apple Intelligence move more iPhones? Or will the post-pandemic sales slump continue?

“The reality is that GenAI is still in its early stages, and the use cases that have been announced may just be the tip of the iceberg for what’s to come,” said Nabila Popal, mobile analyst at IDC.

Apple plans to roll out Apple Intelligence in phases. It will initially only be available in US English and may be blocked in countries with strict AI regulations, such as China. Plus, many of the features Apple announced in June won’t be ready on day one. Instead, they will be rolled out in phases over the coming months.

Because of Apple’s cautious rollout strategy, even the most optimistic analysts expect it will take years for the company to get its artificial intelligence technology into the hands of the roughly 1 billion iPhone users.

Do consumers want artificial intelligence products?

Apple typically makes modest improvements to its iPhones every year. The camera got a little better. The processor is faster. Battery life has been improved. None of this is enough to make consumers rush to upgrade every year or two like they did in the early days of the iPhone, when big hardware innovations became the norm. You can expect the same type of iterative hardware improvements in this year’s phones.

This puts greater pressure on Apple Intelligence to deliver. But consumer appetite is still a question mark.

Results from a recent survey by research firm Canalis It shows that only 7% of consumers are “very inclined” to make purchasing decisions based on artificial intelligence. Interest in Apple is significantly higher in the U.S. and China, the two most lucrative markets, but there are huge differences between the two.

In the US, 15% of respondents said they would be very willing to buy a gadget because of artificial intelligence. In China, consumers tend to be more concerned about technical specifications, with this figure at 43%. The relatively lackluster interest, especially in the United States, suggests Apple needs its marketing machine to tell a compelling story about what artificial intelligence can do for the typical iPhone user.

“There are a lot of interesting features, but you have to give them to the average user in a way that they can reuse them, not just a one-off feature,” said Counterpoint Technology analyst Gerrit Schneemann. “It’s hard to use in a store. A poster or a two-second sales pitch to tell the story.”

Apple Intelligence will use the personal data stored on your phone to help enhance Siri into a more powerful assistant. Additionally, app developers will be able to leverage Apple intelligence so you can use it anywhere on your phone. Schneemann said that compared with Google or Samsung, this is a new interpretation of artificial intelligence.

“It has the potential to help accelerate the education curve and penetrate the market,” he said.

Sales of Samsung’s latest flagship device, the Galaxy S24, are better than last year’s model. But IDC’s Popal said there is little evidence that artificial intelligence is the main driver. Apple falls into another category.

“The psychology of Apple’s high-end customers is different,” Popal said, adding that many iPhone customers use financing plans to buy their phones, which makes it easier to upgrade.

Recently, Google launched the Pixel 9 series of phones, which feature the company’s digital artificial intelligence assistant, Geminibuilt directly into the software. Google’s smartphones have never been major sellers, but they often showcased what was possible with Android phones before the features were available on Samsung or Motorola devices.

The marquee feature on the Pixel is a version of Gemini that allows for natural conversations rather than responding to one command at a time, and other Gemini-equipped Android phones should have this feature in the future.

While reviews of the Pixel 9 have been positive, it’s too early to tell whether AI will ultimately drive sales.

In the PC market, Microsoft Co-pilot+computer Launched this summer, but without Recall, their signature AI feature. (Microsoft learned the hard way that launching a product that takes screenshots of everything you do on your computer every few seconds is not a good idea.) Recoall will enter the market later this fall, Available to a limited number of early testers.

Without Recall, this batch of AI PCs doesn’t have much AI.

The real benefit right now seems to be the power and performance coming from new PC chips Qualcomm First appeared in Copilot+ PC. These processors are based on the same technology used in mobile phone chips, which means they are still very powerful without draining the battery.

Alex Katouzian, general manager of Qualcomm mobile and wearable technology, said: “This is a transformation of the traditional PC, making it look like a mobile device.” He said that Microsoft is developing more artificial intelligence functions and solving privacy issues through Recall.

Microsoft said it expects shipments of Copilot+ PCs to reach 50 million units this year, accounting for about one-fifth of expected sales. Katouzian said the Qualcomm-powered Copilot PC is “on track” so far.

Still, Copilot PC accounts for a “relatively small” share of PC sales. best buy CEO Corey Barry said this summer on the company’s most recent earnings call. She added that customers “just want to replace and upgrade” and are not necessarily looking for devices with artificial intelligence or spending extra money.

Apple’s artificial intelligence launched

If Apple can buck the trend and successfully win the favor of customers through Apple Intelligence, the next step will be to promote it globally to drive iPhone sales in markets outside the United States.

There are other obstacles.

Nearly a fifth of Apple’s sales come from China, where artificial intelligence models require government approval before being rolled out. Apple CEO Tim Cook August told CNBC that his team is working with Chinese regulators to make this happen.

Then there’s the European Union, which has passed a string of strict laws to regulate the world’s largest tech companies. Apple says this summer Apple Intelligence will not be launched in the EU immediately Because of these regulations.

Meanwhile, Apple Intelligence users will become members of a relatively exclusive club. Apple’s job is to convince customers to pay for new devices and join.

“We’re very excited about the value that Apple Intelligence brings to our users,” Cook told CNBC in August. “For that reason, we think it’s another compelling reason to upgrade… We’ll see how the season progresses once we start shipping, but we’re very excited about it.”

watch: Siri’s progress may drive iPhone upgrade cycle