A groundbreaking report by Counterpoint Research predicts that approximately 11% of smartphones sold in 2024 will be equipped with GenAI technology. However, this estimate has been revised upwards since previous projections made in December 2023. The firm now anticipates that the figure will rise to an impressive 43% by 2027.
Counterpoint justified this update by highlighting the anticipated entry of Apple into the GenAI smartphone market later in 2024. This development is expected to significantly impact the industry and drive the demand for smartphones with generative AI capabilities.
GenAI smartphones are defined as mobile devices that leverage large-scale, pre-trained generative AI models to perform a wide range of tasks and create original content. These devices possess multimodal capabilities, allowing them to process text, image, voice, and other inputs to deliver a seamless and fluid user experience.
Counterpoint expects the hardware specifications of GenAI smartphones to evolve as the technology advances. Currently, these devices require hardware capabilities that are on par with or surpass those of flagship smartphones in order to effectively run generative AI models.
Research director Tarun Pathak notes that over 10 original equipment manufacturers (OEMs) have already launched more than 30 GenAI-capable smartphones. Samsung, in particular, has gained significant mind share in marketing early AI use cases with the successful debut of its Galaxy S24 series. Counterpoint predicts that Samsung will lead GenAI smartphone OEM rankings in 2024, giving the company an advantage in the mid-to-premium smartphone segment.
Once Apple enters the GenAI smartphone market, it is expected that AI will become a standard feature in all mid-to-premium smartphone launches from 2025 onwards. However, the true differentiating factor for consumers will lie in the use cases, as they continue to evaluate the potential impact of AI in their future devices.
In the future, smartphones will become increasingly personalized to cater to individual needs and preferences, with AI playing a central role in driving these personalized experiences. Counterpoint emphasizes that OEMs differentiating themselves in the AI space must focus on the evolution of AI use cases. These use cases currently include enhanced imaging capabilities, translation features, improved app experiences, content recommendations, and personalized content creation. As language models continue to grow in size and efficiency, these use cases are expected to further evolve.
GenAI smartphones are projected to reach an inflection point in 2025 as they become available in broader price segments, especially in the $400-$599 price range. Counterpoint predicts that smartphones in this higher price range, as well as those priced above $600, will account for the majority of GenAI smartphones sold in 2024.
Leading chipset companies such as MediaTek and Qualcomm have already embraced generative AI smartphones and have launched mobile computing platforms that support multimodal large AI models on devices. Counterpoint expects Qualcomm to dominate the AI system-on-a-chip (SoC) market in 2024, capturing almost half of all GenAI smartphone shipments, followed by MediaTek with a 13% share.
The integration of edge and cloud computing will likely become the mainstream model for generative AI in smartphones. OEMs that possess strong software capabilities and strategic industry partnerships are expected to stay ahead of the competition in this rapidly evolving market.
According to a report by Counterpoint Research, the GenAI smartphone industry is poised for significant growth in the coming years. The report predicts that 11% of smartphones sold in 2024 will be equipped with GenAI technology, a figure that is expected to rise to 43% by 2027. This upward revision is primarily attributed to the anticipated entry of Apple into the GenAI smartphone market in 2024, which is expected to drive the demand for smartphones with generative AI capabilities.
GenAI smartphones are defined as mobile devices that leverage large-scale, pre-trained generative AI models to perform various tasks and create original content. These devices have multimodal capabilities, allowing them to process text, image, voice, and other inputs for a seamless user experience.
Counterpoint expects the hardware specifications of GenAI smartphones to evolve as the technology advances. Currently, these devices require hardware capabilities comparable to flagship smartphones to effectively run generative AI models.
Several original equipment manufacturers (OEMs) have already launched GenAI-capable smartphones, with over 10 OEMs offering more than 30 such devices. In particular, Samsung has gained significant mind share in marketing early AI use cases with its Galaxy S24 series. Counterpoint predicts that Samsung will lead GenAI smartphone OEM rankings in 2024, giving the company an advantage in the mid-to-premium smartphone segment.
With Apple’s entry into the GenAI smartphone market, AI is expected to become a standard feature in mid-to-premium smartphones from 2025 onwards. However, the differentiating factor for consumers will be the use cases of AI in these devices.
In the future, smartphones are expected to become increasingly personalized, with AI playing a central role in driving personalized experiences. OEMs that differentiate themselves in the AI space must focus on evolving AI use cases, which currently include enhanced imaging capabilities, translation features, improved app experiences, content recommendations, and personalized content creation. As language models continue to grow and improve, these use cases are expected to evolve further.
GenAI smartphones are projected to reach an inflection point in 2025 when they become available in broader price segments, especially in the $400-$599 price range. In 2024, smartphones in this higher price range, as well as those priced above $600, are expected to account for the majority of GenAI smartphones sold.
Leading chipset companies, such as MediaTek and Qualcomm, have already embraced generative AI smartphones and have launched mobile computing platforms that support large AI models on devices. Counterpoint expects Qualcomm to dominate the AI system-on-a-chip (SoC) market in 2024, capturing almost half of all GenAI smartphone shipments, followed by MediaTek with a 13% share.
The integration of edge and cloud computing is expected to become the mainstream model for generative AI in smartphones. OEMs with strong software capabilities and strategic industry partnerships are likely to stay ahead in this rapidly evolving market.
For more information on the GenAI smartphone market, you can visit Counterpoint Research’s website here.