Apple's every move always tugs at the nerves of the global market. The recent news that Apple has entered into a strategic partnership with Chinese tech giant Alibaba to jointly develop artificial intelligence features for Chinese iPhone users has attracted a lot of attention in the industry*. It is reported that Apple has tested the DeepSeek model, but finally chose to join hands with Alibaba, this decision contains Apple's deep consideration of the strategic layout of the Chinese market, and also reflects its strategic adjustment in the global AI competition landscape.
Apple's challenges in the Chinese market
In recent years, Apple has suffered from declining sales in the Chinese market. According to data released by research firm Canalys, Apple's shipments of iPhones and smartphones in China fell by 25% in the fourth quarter of 2024, while Huawei's shipments increased by 24%. In the first quarter of 2025, iPhone sales fell by 11.1% in China, with revenue falling to $18.51 billion. This series of data shows that Apple is facing fierce competitive pressure in the Chinese market. Against this backdrop, Apple urgently needs to improve its competitiveness in the Chinese market through innovation and cooperation.
Apple's AI strategic layout
Apple has been committed to promoting the development of AI technology, and its Apple Intelligence system includes a variety of generative AI functions such as text summarization, image recognition, and video processing. However, due to data compliance and other issues, the implementation plan of Apple Intelligence in China has not been determined. To address this challenge, Apple has been testing different AI models from multiple Chinese AI developers since 2023, including Baidu, Tencent, ByteDance, and DeepSeek, among others. However, the collaboration between the two sides has encountered some hurdles due to Baidu's progress in developing a model for "Apple Intelligence" that is not up to Apple's standards; DeepSeek, on the other hand, is that the company's current experience in cooperating with giant companies is not enough, and the manpower support is also somewhat insufficient.
Pictured: Apple will work with Alibaba to develop AI phones for the Chinese market
Reasons for choosing Alibaba
After a lot of consideration and evaluation, Apple finally chose Alibaba as its partner. There are several key factors behind this decision:
Strong technical strength
Alibaba has a deep technical accumulation and layout in the field of artificial intelligence. Its AI large model, Qwen, has functions such as multi-round dialogue, copywriting, logical reasoning, multi-modal understanding, and multi-language support. The comprehensive performance of Qwen 2.5-Max version exceeds that of many mainstream AI models, providing strong technical support for Apple's AI access in the Chinese market.
Abundant data resources
As an e-commerce giant, Alibaba has a vast amount of personal data about Chinese consumers, such as users' shopping and payment habits. This data can provide rich materials for the training of AI models, helping Apple better understand the needs of Chinese consumers and optimize its products and services.
Compliance and regulatory advantages
Compliance and regulation are important considerations in the application and promotion of AI technology. Alibaba has strict standards and measures for data security and privacy protection, ensuring that the development and application of AI capabilities comply with Chinese laws and regulations. In addition, the two parties have submitted an application to the Cyberspace Administration of China for approval of jointly developed AI functions, marking a significant progress in the partnership.
The market impact of cooperation
The partnership between Apple and Alibaba is not only significant for both parties, but will also have a profound impact on the entire market.
Enhance Apple's competitiveness in the Chinese market
Through the cooperation with Alibaba, Apple can leverage its strong technical strength and rich data resources to develop more attractive AI capabilities, thereby improving its competitiveness in the Chinese market. The partnership is seen as one of Apple's key strategies to address the challenges of declining sales in China.
Promote the development and innovation of AI technology
The cooperation between the two parties will promote the development and innovation of AI technology. Alibaba's Qwen model will be combined with Apple's Apple Intelligence system to provide users with smarter and more convenient services. This will promote the application and development of AI technology in the field of smartphones to bring a better experience to users.
Impact on other businesses
Apple's partnership with Alibaba has also had an impact on other related businesses. Alibaba's share price rose sharply after the news broke, while Baidu's stock price fell. This shows that the market is optimistic about Apple's cooperation with Alibaba, but also poses a certain competitive pressure on other companies.
Future prospects
The cooperation between Apple and Alibaba marks the official start of the in-depth cooperation between the two parties in the field of AI. In the future, the two parties are expected to cooperate in more fields to jointly promote the development and application of AI technology. This cooperation will not only help Apple's recovery in the Chinese market, but also inject new vitality into the development of the global AI industry.
In short, Apple's choice to cooperate with Alibaba is an important step in its strategic layout in the Chinese market. Through the strong alliance between the two parties, it is expected to bring users a more intelligent and convenient AI experience, and will also promote the development and innovation of AI technology. We look forward to the fruitful results of this cooperation and inject new impetus into the development of the technology industry."
*China Exportsemi Note: On February 13, 2025, at the World Governments Summit 2025 held in Dubai, United Arab Emirates, Alibaba co-founder and chairman Joe Tsai responded to the rumors of Alibaba's cooperation with Apple. He said Apple needed a local partner in China to serve its phones, and after talking to a number of Chinese companies, he chose Alibaba. Tsai said Alibaba is honored to partner with a great company like Apple.
