Apple and Alibaba appear to be collaborating to introduce new AI features for iPhones in China
14 Feb 2025
13 Feb 2025
min read
Apple and Alibaba appear to be collaborating to introduce new AI features for iPhones in China.
Medias announced that Alibaba (09988) and Apple Inc. (AAPL) have entered into a partnership to develop artificial intelligence (AI) features for Apple's iPhone in China. Faced with an increasingly competitive environment in the Chinese market, it is said that Apple is hoping that the partnership with Alibaba, a local tech giant with a wealth of personal data about its users' shopping and payment habits, will provide insights into the needs of Chinese consumers, which may help it to train models and provide more customised services, as well as optimise its products and services accordingly.
After the announcement, Alibaba's shares surged over 3%, while Apple’s shares rose over 2%, showing that investors are optimistic about the collaboration.
It is said that Apple has tested AI models from Baidu (09888), Tencent (00700), ByteDance and Alibaba since 2023. Apple chose Baidu (09888) as its primary partner last year. However, the collaboration faced difficulties when Baidu's advancement in creating models for ‘Apple Intelligence’ did not meet Apple's criteria, while Alibaba's extensive consumer data—especially e-commerce and payment behaviors—was the key to its success.
It is said that at the end of last month, Alibaba released its latest Qwen 2.5 Max AI model. The model delivered outstanding performance across multiple benchmarks, such as Arena-Hard, LiveBench, LiveCodeBench, and GPQA-Diamond, further demonstrating Alibaba's preeminence in AI.
Market analysts believe that Apple's cooperation with Alibaba may increase the threat of competition towards Baidu. Baidu has a well-established technological foundation in AI, yet Apple opted to partner with Alibaba. This choice could indicate that Baidu is facing difficulties in competing for a collaboration with Apple.
It is said that Apple decided to abandon the DeepSeek model due to the DeepSeek team's insufficient manpower and experience for supporting a major client like Apple.
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