[News] Apple’s Use of Baidu AI in China Faces Challenges, Potentially Affecting iPhone Sales

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According to Reuters, citing The Information, sources indicate that Apple and Baidu are collaborating to add AI capabilities to iPhones sold in China next year. However, the two companies are facing challenges in advancing the project. The report notes that if these issues cannot be resolved, it could undermine Apple’s hopes of boosting iPhone sales in China.

Reuters states that Apple and Baidu are working on adapting Baidu’s large language model (LLM) to better serve iPhone users in China, but the current models still struggle with understanding user prompts and providing accurate responses to common scenarios.

Another point of contention between the two companies involves differing views on how to use iPhone user data to train and improve the models, as the report highlights. The report notes that Baidu wishes to retain and analyze data obtained from iPhone users, but Apple’s privacy policies strictly prohibit collecting such data.

The report mentions that Baidu is leveraging its most advanced model, Ernie 4.0, as the foundation for Apple’s generative AI services, which will be applied to devices such as iPhones, Macs, and iPads. Siri is set to integrate Baidu’s AI models, Reuters adds

Citing sources, another Anue report highlights that Siri will integrate Baidu’s AI model primarily to enhance search results. It also notes that Baidu has been the default search engine for Apple’s web browsers in China since 2012 and has served as Siri’s default search engine since 2015

Meanwhile, according to the report from Anue, Baidu is allocating more cloud computing resources for the development of Apple Intelligence and plans to increase spending on chips to handle the expected surge in requests from Apple users. Apple has paid Baidu for the use of its AI models and agreed to bear the costs of training the models, making Apple one of Baidu AI’s largest revenue sources.

Apple plans to launch Apple Intelligence in China as part of its efforts to boost iPhone sales. However, as noted in the report by Anue, while adding generative AI capabilities could enhance the user experience, there is no assurance that these features will lead to a significant increase in iPhone sales in China.

Read more

• [News] Apple Struggles to Launch Apple Intelligence in China Due to Government Approval Challenges
• [News] Apple Reports 6% Revenue Growth, Strong iPhone 16 Demand Amid Declining Sales in China

(Photo credit: Apple)