This is my second visit to China this year. apple Chief Executive Officer Tim Cook met with Beijing officials and local partners as the company faces the challenge of launching Apple Intelligence and increasing competition in the market.
China’s Minister of Industry and Information Technology met with the CEO in Beijing on Wednesday to discuss Apple’s expansion in China, network data security and cloud services, according to a statement from the ministry.
During the meeting, the ministry said Cook signaled Apple’s commitment to the country, pledging to increase investment in the market and grow alongside Chinese companies. According to local reports, he also met with leaders of several local Chinese companies on the same day, including China Mobile Chairman Yang Jie, and discussed cooperation on digital content and 5G products.
Ivan Lam, senior research analyst at Counterpoint Research, said the timing of the visit was significant as local competitors are introducing modern operating systems that integrate AI and new flagship products. Ta.
“This visit seems noteworthy now as the company may be looking to strengthen cooperation with local companies to launch Apple Intelligence in China,” Lam said.
Le Xuan Chiew, an analyst specializing in Apple strategic research at Canalys, said the deployment of Apple Intelligence in China was likely the main motive for Cook’s visit, adding that “China’s importance to Apple’s global strategy” It is also about “strengthening sexuality.”
The timeline for Apple Intelligence deployment in China remains “uncertain” and will depend primarily on regulatory approval, but this may explain some of the messaging focus of the China visit, Chiew said. he said.
This could be a problem for the company, he added, as the lack of Apple Intelligence in Chinese devices is expected to reduce the incentive for users to upgrade to iPhone 16.
Apple Intelligence is the company’s artificial intelligence role that aims to bring AI to its devices, including improved voice assistants, automatically organizing emails, and transcribing and summarizing voice recordings. It has features such as tools.
The company has said it will roll out Apple Intelligence in U.S. English this fall, but has remained quiet about plans to offer the product in China.
Mr. Cook frequently travels to China, Apple’s largest overseas market, to unveil products and factories, visit suppliers and meet with local officials. During his visit in March, he was in Shanghai for the opening of a new retail store. He also visited Chengdu around this time last year, when Apple was facing weak demand in the world’s second-largest economy.
During the trip, Cook visited the offices of Chinese social media giant Weibo, where he was photographed meeting with the CEO and posted on his personal Weibo account. Weibo is one of the local app developers that released an application for Apple’s Vision Pro mixed reality headset, which was launched in the Chinese market in June.
Apple successfully launched the latest model in the series, the iPhone 16, in China in September this year, and the new phone got off to a strong start. Sales rose 20% in the first three weeks after launch compared to the 2023 model, according to data from research firm Counterpoint.
However, despite the successful launch of new products, overall iPhone sales, including older models, fell 2% year-on-year in China in three weeks.
Apple is facing a decline in market share in China as competition from local companies increases and Chinese consumers increasingly choose domestically made products.
According to Counterpoint, the company’s market share fell 5.7% year-over-year in the second quarter.
After making headlines last year with its surprise 5G model, Huawei, one of Apple’s main competitors in China, launched a competing device on the same day as the iPhone 16.
“Huawei’s recent resurgence in the high-end market, driven by its own chips and HarmonyOS ecosystem, has intensified the competitive environment and made it difficult for Apple to maintain its leadership position,” Canalys’ Chiew said. ”
Apple’s Vision Pro may also face more competition in the market, as Huawei is reportedly preparing to launch its own competing headset as soon as next week.
— CNBC’s Arjun Kharpal contributed to this report
