The generative AI smartphone age is here

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Generative AI is coming to your smartphone. Yes, the biggest technology trend in years is landing on your most important device. But how exactly it will impact your everyday life is still unclear.

Google (GOOG, GOOGL) and Samsung are leading the generative AI charge with their latest smartphones, the Google Pixel 8 and 8 Pro and Samsung Galaxy S24 lineup, and you can expect others to join the fray, including Apple (AAPL), throughout 2024 and beyond.

Analysts say generative AI capabilities will quickly become table stakes for companies. That will also help tech giants hoping to woo potential smartphone customers and spawn a new upgrade cycle at a time of anemic device sales.

“I think in the not-too-distant future, all phones will have some level of these capabilities,” explained TECHnalysis Research founder and president Bob O’Donnell. “It's the kind of thing that I think … people can just start to expect.”

According to analysts at UBS, generative AI smartphones will start off slow but increase in sales rather fast.

“Combining Apple, smartphone and other Android brands, we project Gen AI smartphones to ramp from 50 [million units] or 4% penetration in 2023 to 583 [million units] or 46% penetration in 2027,” UBS analysts said in a January research note.

Samsung is banking on its Galaxy AI offerings to boost sales of its Galaxy S24 line of smartphones. (Image: Samsung)
Samsung is banking on its Galaxy AI offerings to boost sales of its Galaxy S24 line of smartphones. (Samsung) (samsung)

So what can you expect from AI smartphones beyond what your current device can already do? That’s still a surprisingly open question.

Generative AI on the go

Beyond a few apps and features for existing software such as the ability to improve video calls or run photo editing programs locally, companies are light on details as to how generative AI will change the overall user experience.

On the PC side, Microsoft is loading its Copilot app onto Windows 11 machines, but that’s a web-based platform that doesn’t require any particular hardware on your side.

“If I compare PCs and smartphones, I think there's much more hope that smartphones will actually start to, over time, demonstrate real value from AI and Gen AI,” explained Gartner senior research director Ranjit Atwal.

According to UBS analysts, generative AI-capable smartphones could improve multimedia content creation; enable fast photo and video editing; and provide better speech-to-text, translation, and enhanced gaming capabilities. Samsung and Google are already offering powerful generative AI photo editing and translation capabilities in their latest devices.

Like all things related to smartphones, Apple will play an outsized role in how generative AI technology makes its way into our devices. But how the company does so will be just as interesting as when it adds the feature to its iPhones.

“Will they do it through Siri and then Siri automatically talks to the other apps, which would be a different way of presenting the same capability? Or … are they going to do something else? I think the devil is going to be in the details of how it’s implemented,” O’Donnell said.

However Apple decides to bring generative AI to the iPhone, though, it will have a distinct advantage over rival Samsung, Deepwater Asset Management managing partner Gene Munster explained.

That’s because Apple controls every aspect of the iPhone, from the software to the hardware right down to the chip that powers it all. That kind of capability should help Apple ensure that the overall experience is as seamless as possible.

It also doesn’t hurt that Apple has been taking advantage of the neural engine in its A-series chips for years to help power a number of on-device machine learning processes.

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According to Apple soothsayer Bloomberg’s Mark Gurman, Apple will bring generative AI capabilities including auto-summarization for long text and auto-complete writing tools and add generative AI features to the company’s developer tools. Apple, Gurman says, will debut those features at its annual WWDC developer conference in June.

That, however, also means that Apple will be well behind Google and Samsung in bringing generative AI capabilities to market.

But with the full extent of generative AI technologies for smartphones still up in the air, it might not actually matter.

Daniel Howley is the tech editor at Yahoo Finance. He's been covering the tech industry since 2011. You can follow him on Twitter @DanielHowley.

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