Apple’s Risky Decisions Could Hurt iPhone 16 Pro

Tim Cook poses for a selfie at the opening of the new Apple store in Mumbai, India, Photographer: … (+) Indranil Aditya/Bloomberg

Tim Cook and his team will launch the iPhone 16 and iPhone 16 Pro smartphones next month, and Apple will finally offer its loyal followers a modern AI toolkit. But will Apple’s decision to rely on Apple Intelligence be rewarded?

During Apple’s recent quarterly earnings conference call, it was noted that iPhone sales have been a smaller percentage of the company’s total sales over the past four years. In the third quarter, sales fell from $39.67 billion in 2023 to $39.30 billion in 2024.

Cook pressed hard on one topic during the talk: generative AI. Apple’s awkwardly named AI was announced in June at the Worldwide Developer Conference, and the first implementations are already available in beta for iOS developers, ahead of a public launch with the iPhone 16 and iPhone 16 Pro in September.

Aside from last year’s iPhone 15 Pro and 15 Pro Max, any iPhone user who wants to experience an AI smartphone and stay in the Apple ecosystem will have to buy a new iPhone due to the high technical requirements needed to run the software. Apple must assume that the iPhone 16 family will unlock AI demand, and a cascade of sales will follow.

However, Apple’s decisions regarding AI implementation and the immediate need for it may not be enough to pull the iPhone 16 out of its slump.

Apple iPhone 15 smartphones at Grand Central store in New York, Photographer: Jeenah … (+) Moon/Bloomberg

Apple is late to the generative AI party. Two weeks after the iPhone 15 family went on sale, Google debuted the Pixel 8 and Pixel 8 Pro. They were the first AI smartphones to launch, and Google’s selection of AI tools became the baseline for expectations. With Galaxy AI, Samsung’s fast-track, Qualcomm’s decision to include AI in Snapdragon specs, and other manufacturers’ adoption of its AI vision, Google has successfully defined the generative AI approach for smartphones of 2024.

Google will reveal the Pixel 9 family and the next generation of AI tools next week, a full month before the iPhone 16 launches. Apple’s iOS will be the two main versions of the Android operating system when Apple Intelligence finally arrives.

Apple Intelligence won’t launch with the iPhone 16 either. It’s expected to be included in an October 2024 iOS update. When that time comes, its capabilities will be limited. Apple won’t make the full suite of tools available to consumers until the first quarter of 2025. Not only will Google be racing ahead with the Pixel 9’s nearly six-month lead, but Samsung’s Galaxy AI will also get its own annual update alongside the Galaxy S25 family.

Galaxy S24 Ultra on display at Galaxy Unpacked on January 17, 2024 in London, UK.

Ewan Spence

The competition will have a years’ lead over Apple, the capabilities of Apple Intelligence will be severely limited at launch, and all those hungry for artificial intelligence will have already moved to a more efficient platform.

iPhone sales aren’t going to drop. But Apple doesn’t want to keep the same volume it’s been doing for the past few years. Tim Cook has been preternaturally vocal about AI being the “super feature” that will unlock sales through pent-up demand…assuming Apple can overcome the self-imposed obstacles to success.

Read the latest headlines on iPhone, Mac, and iOS in Forbes’ weekly Apple news roundup…