AI-capable smartphones: Trends in the Chinese market and future outlook
The AI-capable smartphone market in mainland China experienced an impressive 591% year-on-year growth in devices shipped in Q3 2024, showcasing the rapid advancements made by Chinese companies in AI technology. This growth not only reflects the size of the Chinese market but also the substantial investments and innovations made in AI smartphone capabilities. Let’s delve into three key trends that are shaping China’s AI smartphone market in 2025 and beyond.
One major trend driving the adoption of AI-capable smartphones in 2025 is the optimization of smaller on-device AI models to enhance usability and efficiency. Chinese vendors have made significant progress in this area by utilizing cutting-edge quantization and pruning techniques. For example, Xiaomi’s MiLM2 reduced model parameters from 6B to 4B, while HONOR and vivo trimmed their models from 7B to 3B parameters. These optimizations have not only lowered computational costs and improved speed but have also made AI functionalities on flagship devices more user-friendly. This progress is paving the way for wider adoption of AI across different price points.
Another key trend in the Chinese AI smartphone market is the transition to open ecosystems and strategic collaborations. Initially, Chinese vendors focused on developing proprietary on-device and cloud-based LLMs to establish themselves as technological leaders. However, as AI-capable smartphones become more prevalent, the limitations of a closed ecosystem, especially in terms of scaling and cost-effectiveness, have become apparent. In response, vendors like OPPO and Xiaomi have begun embracing open model ecosystems, such as their collaboration with ByteDance to integrate the Doubao LLM for cloud-based tasks. This shift towards openness allows for the widespread delivery of valuable AI functionalities, enhancing user engagement while addressing scalability challenges. Open ecosystems are expected to drive large-scale AI deployment, balancing innovation with practicality.
Lastly, the maturation of privacy protection frameworks is a crucial trend in the Chinese AI smartphone market. Both consumers and regulators place a high priority on data security and privacy. In 2024, local vendors made strides in enhancing cloud AI privacy protection. For instance, OPPO introduced its Private Computing Cloud at ODC in 2024 to enhance data security and privacy, while vivo refined its Trusted OS framework to ensure end-to-end protection. Vendors like HONOR, who collaborate closely with third-party partners, are empowering users with greater transparency and control over their data. These efforts are essential in building trust with consumers and ensuring ethical data practices in the AI ecosystem.
Overall, these trends highlight the exciting developments happening in the AI-capable smartphone market in mainland China. As Chinese companies continue to innovate and collaborate, the future looks promising for AI technology in smartphones.
