Two of the world's biggest smartphone makers, Samsung and Apple (AAPL), are putting all their efforts into generative AI. Take Samsung's latest Galaxy Unpacked event in Paris, where the company unveiled its latest foldable smartphone and touted the benefits of its Galaxy AI platform.
Meanwhile, Apple spent much of its WWDC event in June focusing on how its generative AI software, “Apple Intelligence,” would power new features for the iPhone. But these companies, which together account for 36.6% of the global smartphone market as of the second quarter of 2024, according to IDC, are taking distinctly different approaches to bringing generative AI to users.
Samsung hopes to quickly build a large user base for its AI-generated services and encourage developers to build apps for its Galaxy AI platform, which will then attract more users if those apps prove to be powerful and useful.
Samsung's Galaxy AI features are available on the Galaxy S24 this year, the S23 last year, the Galaxy S22 in 2022 and three generations of foldable phones. Samsung has said it plans to bring Galaxy AI to about 200 million devices by the end of the year. But Apple has said only owners of its most powerful iPhones, the iPhone 15 Pro and iPhone 15 Pro Max, and later models of the popular smartphone will be able to access the Apple Intelligence features.
Apple hopes to boost iPhone sales in the short to medium term by persuading users interested in generative AI apps to upgrade to the next generation of devices rather than sticking with their current iPhones for years to come.
Despite their different approaches, both companies need to prove to consumers that generative AI apps are worth the fuss, and that will take time.
“Most of our purchases will be made by 2025 or even further out. [people] Due to a shortage [AI] ” Explains Ryan Reith, program vice president for IDC's Mobile Device Tracker suite.
Samsung vs. Apple
Samsung launched its Galaxy AI platform alongside the Galaxy S24 series in January, featuring several AI apps from Google (GOOG, GOOGL), putting it ahead of Apple in the AI race. Since then, the company said, 77% of S24 users have used the company's AI features at least once a week. So far, Samsung said Google's Circle to Search feature, which lets you take a photo of an object or text and circle it to identify or translate it, is one of its users' favorite AI options.
In addition to Google's Circle to Search, Samsung offers AI-powered translation, transcription, text creation, and photo editing apps, of which I find transcription the most useful, while photo editing, which uses generative AI to manipulate photos, feels more like a party trick than an essential feature people will use on a daily basis.
Still, these options are just the beginning, and getting them into the hands of users and developers will no doubt help Samsung create more interesting and, importantly, more useful AI products in the future.
“Samsung is [Galaxy AI] “We want as many people to know about it as possible,” explains Bob O'Donnell, president and principal analyst at TECHnalysis Research.
“They want developers to be excited about building things for their platform, so this is a way to do that, because by Samsung embracing a product that's a few generations back, all of a sudden they have a much larger installed base, whereas Apple, obviously, is going to have a much smaller installed base,” he added.
Samsung's approach should motivate developers who want to reach a large user base to start building apps for its platform. And if those developers create compelling apps, users will inevitably choose Samsung devices to access them. This approach won't drive smartphone adoption in the near future, but if customers like using apps developed for Samsung's AI services, they'll be much more likely to buy Samsung devices when they buy a new smartphone in the future.
But Apple isn't going to wait for phone sales to slowly pick up. The company clearly wants people to buy the next generation of iPhones the moment they hit the market, likely as soon as September of this year. That makes sense for Apple: The iPhone is the company's most important product, and with sales set to fall in 2023 and a poor start to 2024, it's imperative to get the new devices into consumers' hands sooner rather than later.
Wall Street is hoping the company's Apple Intelligence platform will help drive a new sales cycle over the next 12 months, and tying the software to the latest and greatest iPhones could increase Apple's chances of making that happen.
But it also means that Apple's AI-generated products will have fewer installed users than Samsung's — and, at least in the short term, that could have a negative impact on developers building AI on top of Apple's software.
Do consumers really want generative AI?
But all this talk about generative AI is worthless unless consumers actually understand it, and while Samsung's early adoption rates are impressive, those numbers only count the number of users who access the AI software once a week. Given that we all pick up our phones dozens of times each day, it's still not fully on board.
On a personal note, my family and friends are still pretty confused about what adding generative AI to a smartphone means for them. Samsung and Apple have made splashy announcements, but the general consumer, at least the people around me, still don't fully understand the whole concept.
For now, we'll have to wait and see how Apple pitches Apple Intelligence at its upcoming iPhone event in September, and how Samsung and Google evolve their own messaging and offerings in the coming months.
Contact Daniel Howley at dhowley@yahoofinance.com. Follow him on Twitter. Daniel Howley.
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