Apple and Alibaba's AI Rollout in China Delayed Amid Geopolitical Tensions
Apple and Alibaba’s joint venture to roll out artificial intelligence (AI) services in China has encountered significant delays, according to a report from the Financial Times.
The delay is attributed to regulatory obstacles posed by China’s Cyberspace Administration of China (CAC), stemming from increasing geopolitical uncertainties between China and the US, particularly in the wake of the ongoing trade war.
In February, Apple and Alibaba announced their collaboration to bolster AI features in China, with a focus on enhancing iPhone services. This move was anticipated to help Apple offset its declining smartphone sales in its crucial Chinese market.
However, their applications for approval have been stalled by the CAC, as AI-driven consumer-facing products require rigorous regulatory clearance in China.
Impact on Apple’s Market in China
According to Reuters, the delay in AI services could be detrimental to Apple, which is facing declining iPhone sales in China. The company’s sales have been adversely affected by growing competition from domestic brands, notably Huawei, which has integrated advanced AI models from DeepSeek into its cloud services and devices.
AI features have become a key selling point in modern smartphones, and Apple’s lack of competitive AI features, such as those found in rival Android smartphones, has been seen as a significant disadvantage in China. In particular, Apple has been slow to roll out Apple Intelligence, a suite of features leveraging ChatGPT, which has been widely adopted in Android devices.
Also read: Apple to Unlock Its AI Models for Developers
The Broader Geopolitical Context
This delay is part of the broader context of escalating trade tensions between China and the US, which has impacted many American tech companies operating in China. US President Donald Trump's trade policies have added layers of complexity to the rollout of tech products and services in China, with tariffs and regulatory scrutiny complicating operations for companies like Apple.
In addition, Apple faces a 25% tariff on iPhones sold in the United States if they are not manufactured within the country, which Trump imposed in late May. This adds another financial burden to Apple’s already strained market position in China.
