Apple revealed on Monday a new iPhone designed for generative artificial intelligence in an effort to boost sales and demonstrate that it is keeping up with the technology race. The tech behemoth has a lot riding on what would be the iPhone 16 and will hope that buyers are lured to buy the latest models, drawn in by new AI capabilities.
“We are thrilled to introduce the first iPhones designed from the ground up for Apple Intelligence and its breakthrough capabilities,” Apple CEO Tim Cook said during an event at the company’s Silicon Valley headquarters.
With $39 billion in sales last quarter, the iPhone accounts for nearly 60% of Apple’s income and remains the primary entry point to the company’s services, such as the App Store and Apple TV, which are becoming increasingly important parts of its business.
Apple is only now emerging from a prolonged sales downturn, as customers continue to remain with older models for extended periods of time.
“This iPhone 16 release is all about Apple Intelligence and the unleashing of the consumer AI Revolution through Cupertino,” Wedbust analyst Dan Ives wrote in an investor note, referring to Apple’s hometown. “In essence Cupertino will be the gatekeeper of the consumer AI Revolution.”
“Apple Intelligence” is a new suite of software features for all devices revealed in June at the company’s annual developers conference, along with a relationship with ChatGPT creator OpenAI. “For years, artificial intelligence and machine learning have been essential in delivering so many of the features and experiences you love,” according to Cook.
“In June, we launched Apple Intelligence, our powerful new personal intelligence system, which will have an incredible impact.” In the immediate future, these include AI-powered image editing, translation, and minor, creative touches in communications, but not the more ambitious advances promised by other AI companies like OpenAI and Google.
Ives anticipates software developers to begin producing apps and services with generative AI capabilities, boosting iPhone sales. Apple is anticipated to design new AirPod earbuds and smart watches that take advantage of AI capabilities and the Siri digital assistant. During the event, the company unveiled new Apple Watch and AirPod versions.
Apple is attempting to “shake that expectation” that iPhone launches are “just steady improvements in hardware and software,” according to Techsponential analyst Avi Greengart. Longer ahead, Greengart believes Apple may significantly alter the iPhone experience with a “super-powered Siri” that works across all apps.
Apple’s launch comes on the heels of Google’s announcement last month of AI-infused Pixel 9 devices, which will compete with the iPhone. Pixels account for a small portion of the worldwide smartphone industry, which is dominated by Samsung and Apple, but Google argues that its new range is an opportunity to demonstrate what AI can truly achieve for users, despite all the hoopla.
“There have been so many promises, so many ‘coming soons,’ and not enough real-world helpfulness when it comes to AI — which is why today we’re getting real,” Google senior vice president of products Rick Osterloh said at the Pixel 9 announcement. Samsung has also demonstrated AI in a variety of consumer electronic items as it seeks to maintain its lead in global smartphone sales.
