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The Rise of Gen AI Smartphones

Reshaping the Mobile Experience
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Over the last 30 years, the mobile phone industry has been through two major revolutions. The first revolution began when the mobile phone emerged, transforming the way we communicate by introducing mobile communications into our lives. The second revolution emerged in the latter half of these three decades when smartphones disrupted everything else in our lives.

Today, with 3.1 billion smartphones in use globally, these devices play a critical role in the world. The latest technological development that has taken the tech world by storm is the launch of AI-powered smartphones. Although AI is not new, it gained significant attention with the launch of ChatGPT and the capabilities of Generative AI (GenAI). Leveraging Large Language Models (LLMs), a new revolution is coming to the smartphone – intelligence.

Defining AI Smartphones*

According to IDC, Gen AI smartphones are defined as devices featuring a system-on-a-chip (SoC) capable of running on-device Generative (Gen AI) models more quickly and efficiently leveraging a neural processing unit (NPU) with 30 Tera Operations Per Second (TOPS) or more, using the int-8 data type.

The smartphone SoCs being designed and marketed by silicon vendors with next-gen AI smartphones in mind will increase in the future as they continue to push forward the NPU technology. However, to date, here are a few that qualify based on the definition above:

  • Apple A17 Pro
  • MediaTek Dimensity 9300
  • Qualcomm Snapdragon 8 Gen 3
  • Samsung Exynos 2400

Market Opportunity

The latest IDC forecast estimates that Gen AI smartphone shipments will grow 364% year-over-year in 2024, reaching 234.2 million units.

Despite the current macroeconomic environment and the fact that consumers are keeping their devices longer, the potential of Gen AI on a smartphone is expected to drive significant demand over the coming years. This segment is projected to be the fastest-growing segment in the smartphone category during the forecast period, outperforming the non-AI-enabled smartphone segment. Growth will continue into 2025 with an expected increase of 73.1%, followed by moderate double-digit growth for the rest of the forecast period. By 2028, worldwide Gen AI smartphone shipments will reach 912 million units, resulting in a compound annual growth rate (CAGR) of 78.4% for 2023-2028.

Reshaping the Mobile Experience

AI will enable manufacturers to offer unique and intelligent features, experiences and even services to their users. Since the introduction of the first iPhone and Android smartphones in 2007 and 2008, and particularly after the introduction of app marketplaces by Apple and Google, users have become used to interacting with the smartphone by using apps. The more powerful the apps, the better it is. With AI, the fewer apps the phone will need and the more capable can use data contextually to assist the user, the better it will be. This “app-less” world will revolutionize the user experience, requiring the phone to better “know” its users while ensuring personal data remains private and secure.

The interaction with the smartphone will shift from touch to voice, as “intelligent” voice assistants become our true personal digital assistants. These conversational digital assistants, fully integrated with the device, will be game-changers, providing compelling reasons for users to upgrade their smartphones.

Although a full AI experience is still in development, less than 18 months after the introduction of ChatGPT, several vendors announced their AI strategies and devices showcasing some intelligent capabilities. These include:

  • Samsung Galaxy S24 Ultra: Some of the key AI features include a transcription summariser built into the voice recorder, real-time voice translation, and Circle to Search, a tool developed by Google that allows users to draw a circle around anything on screen and search it on Google.
  • Xiaomi 14 Ultra: Features AI-generated subtitles for video calls and an AI Portrait feature that lets users take a selfie and add a different background.
  • Google Pixel 8 Pro: Offers features like summarising recorded conversations, suggesting replies to messages, and creating AI-generated wallpapers. The camera also benefits from AI with Magic Editor (moving or removing objects); Best Take (selecting the best shot), and Video Boost (enhancing video colour and lighting).
  • Apple Intelligence: The new suite of AI features will come to the iPhone, iPad and Mac later this year with the latest OS versions announced at Apple Worldwide Developers Conference. The AI features will include rewriting text and proofreading, generating email replies, and content summarization. Users will be able to generate images from text based on note contents and remove objects from photos. Siri, Apple’s digital assistant will become more conversational.
  • OPPO AI Strategy: Betting big on AI, OPPO aims to incorporate over 100 Gen AI features across its lineup of AI-enabled smartphones in 2024. Unlike other players, OPPO aims to democratize AI by introducing these features to more affordable price points.
  • Honor Magic 6 Pro: The device promises AI-powered user experiences and it is the first Honor’s all-scenario strategy, featuring cross-OS collaboration and AI designed with a human-centric approach.
  • Motorola Razr 50 Ultra: Will run Google Gemini as the main digital assistant, offering AI out of the box. Features include recognizing photos, summarizing text, answering voice queries, and changing message tones before sending. It includes Motorola’s AI tool, Style Sync, which creates a wallpaper based on the colors and patterns of a specific photo.

Use Cases

Gen AI smartphones are expected to disrupt different aspects of our lives. IDC identified several use cases that can drive adoption and have a positive impact:

  • Work Environment: According to an IDC survey, employees view the smartphone as one of the most important tools in the workspace. AI will streamline tasks by summarizing content from meetings and documents, allowing users to focus on discussions. AI will also summarize email threads, suggest replies based on the conversation, and help manage calendars based on requests received via email or messages.
  • Healthcare and Wellbeing: Smartphones have become central to various wearables (through apps) that collect data on vital body signals, such as blood pressure, heart rate, and blood oxygen. AI will monitor this data from all sensors, alerting users to potential risks and suggesting dietary and exercise plans for a more active lifestyle. Acting as a digital personal trainer, AI will provide guidance beyond simple tracking.
  • Education: AI is already an important tool in the classroom, both directly and indirectly. Students increasingly rely on tools such as ChatGPT for content research, note-taking, and transcribing and summarizing lessons. AI on smartphones will make these tasks mobile, with the camera becoming an important source of prompts. Additionally, AI will help students manage their study plans and understand complex subjects more quickly and efficiently.
  • Entertainment: For most people, the smartphone is the device of choice for content creation, taking photos and creating videos for social media. It has also become the primary tool for streaming content and gaming. AI will optimize visual effects, providing a more immersive experience, and act as a “gaming assistant”, enhancing the overall experience and increasing engagement. Also, by generating images and videos from text on the device, users can share content more creatively.
  • Mobility: Users increasingly rely on smartphones for directions and finding information about locations. AI will improve commuting and travel by efficiently analyzing traffic patterns, user travel journeys, and frequent destinations. It will offer improved planning by integrating travel needs with calendar appointments, making commutes more efficient.

The rise of Gen AI smartphones will become the next technological revolution. As the most widely adopted consumer electronics, Gen AI smartphones are set to reshape the mobile experience through unparalleled enhanced intelligence. Smartphones will bring new features and use cases, unlocking the next phase of intelligence for these devices. As AI features and applications grow, consumers will prioritize these advanced capabilities in their next purchase.

*For a more detailed technical definition and explanation about the definition of IDC’s AI smartphone, you can read our blog, The Future of Next-Gen AI Smartphones.

For a look at industry and segment spending forecasts for broader AI and GenAI use cases, see IDC’s ⁠AI and GenAI Spending Guide.

Francisco Jeronimo is VP for Data and Analytics at IDC Europe. Based in London, he leads the research that covers mobile devices, personal computing devices and emerging technology trends across Europe. His team delivers data on personal computers, tablets, smartphones, wearables, smart home and augmented reality and virtual reality, and provides in-depth analysis of the strategies and performance of the key industry players.