Apple Unveils iPhone 16

By Max A. Cherney and Kenrick Cai

CUPERTINO, California (Reuters) – Apple on Monday kicked off an event to unveil its iPhone 16 and showcase artificial intelligence features of the flagship device. However, Apple could be overshadowed by a triple-folding smartphone unofficially released by China’s Huawei hours earlier.

Apple’s event at the tech giant’s Apple Park headquarters began at 10 a.m. PDT (1700 GMT). Huawei has scheduled an official announcement of its Mate XT phone on Tuesday in China.

The Chinese company’s website indicated that it garnered more than 3 million pre-orders for its Z-shaped tri-fold phone, highlighting Huawei’s capability to navigate U.S. sanctions and solidifying its position against Apple in China, where consumers are eager for more AI features.

Apple shares (NASDAQ:AAPL) declined less than 1% in midday trading.

Ben Bajarin, CEO and principal analyst at Creative Strategies, stated, “The Chinese market is hungrier for AI features than the U.S. market.” For Apple, it would be challenging to bring these features to China immediately, relying mainly on the merits of the hardware.

Apple unveiled Apple Intelligence at its developer conference in June, introducing generative AI designed to create text, images, and other content on command. However, these upgrades will take time to reach consumers.

Apple Intelligence features are expected to launch in a software update to the iPhone and iPad operating system likely in October, with a full upgrade of Siri expected early next year, according to media reports.

Approval from Beijing is required for the release of Apple Intelligence in China. In July, OpenAI blocked access to ChatGPT in China, which could affect the chatbot’s integration into Siri. Apple has not disclosed an AI partner for China.

IPhones constituted over half of Apple’s $383 billion sales last year, and the new devices are vital updates for the Cupertino-based company, which is betting that AI features will encourage consumers to upgrade amid a slowdown in iPhone sales.

Earlier this year, Apple aggressively reduced prices in China due to government restrictions and increased domestic competition.

The iPhone 16 lineup will be the first designed with AI features, though they will also be available on the iPhone 15 Pro and Pro Max. New versions of the Apple Watch and AirPods are also anticipated.

Bajarin noted, “The software side, and how Apple frames it, is the biggest question. Investors will evaluate if it’s compelling enough for a larger-than-normal upgrade cycle.”

Rivals, including Alphabet’s Google, are also demonstrating AI features to challenge Apple’s dominance in the high-end smartphone market. Google, which develops the Android operating system competing with Apple’s iOS, shifted its fall Pixel smartphone event to August prior to Apple’s announcement.

Google emphasized AI features such as Gemini Live, allowing users to engage in live voice conversations with a digital assistant. Many of these features were also introduced to Android devices made by various manufacturers.

Bob O’Donnell, chief analyst for TECHnalysis Research, posed the question: “Who will be the first to combine a truly personal AI assistant with accurate and personalized information?”

So far, Apple has shared a release timeline for Apple Intelligence only in the U.S., set to launch on compatible devices this autumn. It also announced a delay for the release in Europe due to EU tech regulations.