Apple’s Challenges with AI Integration in China

AI features have become a success factor in China, with local smartphone manufacturers like Xiaomi, Honor, and Huawei explicitly promoting them. For Apple, this is a problem because the company cannot initially offer Apple Intelligence in the country due to local conditions. According to the Financial Times, this situation is likely to continue for a while.

The rollout of Apple Intelligence, part of Apple’s main operating systems since iOS 18.1, iPadOS 18.1, and macOS 15.1, is happening gradually. Initially, the feature is limited to US English. In Europe, it is not officially planned before April 2025 due to regulatory concerns, except with workarounds on Mac. In China, it is completely disabled. However, AI was expected to become a selling point with the iPhone 16 series, but this is currently only effective in the United States. More features like AI image generators are set to appear on devices in the coming weeks.

From Beijing, it is reported that Apple faces a “difficult and long process” before introducing Apple Intelligence locally. According to a top official who wished to remain anonymous, the only option is to partner with “local groups.” Recently, Apple CEO Tim Cook visited China and met with the Chinese Premier along with other foreign business leaders. It is unknown if Apple Intelligence was discussed.

The Cyberspace Administration of China is preparing an approval process for foreign large language models (LLM), which is expected to be “long” and “complex.” The official suggested connecting with Chinese LLM providers whose language models have already been reviewed, promising a “simple and direct approval process.”

For Apple, this situation is challenging. The company might have to reveal trade secrets and could struggle to maintain its privacy promises. Apple Intelligence combines local models on iPhone, iPad, or Mac (using Apple Silicon, at least 8 GB RAM, and Neural Engine) with a secure server connection called Private Cloud Compute (PCC). The PCC system is set up to perform calculations without Apple learning the details. In China, Apple might need to use alternative LLMs from competitors, such as Baidu’s Erniebot. The PCC system might not be feasible. However, Apple is willing to take special measures in China, as seen with their collaboration with government-owned companies for iCloud.

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