BY Fast Company 3 MINUTE READ

Generative AI (general artificial intelligence) has been the trendiest term in software for two years. Now it’s about to make its way to the consumer hardware market, too. By the latter half of this year, it’s likely that we’ll begin to encounter phones being marketed as GenAI smartphones or simply GenAI phones. But just what is a GenAI phone, and where does the phrase come from? Here’s what you need to know.

WHAT IS A GENAI PHONE?

As far as I can tell, the term GenAI smartphone first came to prominence only in the last six months, when it began appearing in reports by a few major marketing research firms.

In December, Counterpoint Technology Market Research issued a report on GenAI smartphones that described one of their main characteristics as being “a subset of AI smartphones that uses generative AI to create original content, rather than just providing preprogrammed responses or performing predefined tasks.” (In April, it expanded on that definition.)

And in February, Gartner offered its own definition, which says one of the key differentiators of a GenAI phone versus a regular smartphone is that the GenAI phone is “capable of locally running a base or fine-tuned AI model that generates new derived versions of content, strategies, designs, and methods.”

Counterpoint’s and Gartner’s definitions differ a little (and are very wordy), but it’s safe to say that a GenAI phone can be considered a smartphone that has at least the four following characteristics:

– Offers generative AI apps and tools, such as AI chatbots and AI image editing and generation apps.

– These tools should be baked into the phone’s operating system wherever possible so they can be used seamlessly system-wide.

– The phones should have CPUs—computer chips—designed specifically for handling complex AI tasks.

– The phones should be powerful enough to run AI models natively on the device instead of needing to send data to the cloud for AI servers to process remotely.

WHAT ISN’T A GENAI PHONE?

If we use the four points above to define what a GenAI phone is, it becomes evident that as of May 2024, few smartphones can be considered true GenAI phones. That’s because most of the smartphones available today don’t have chips designed specifically to handle complex AI tasks.

And while many smartphones today can run, for example, the ChatGPT app, that doesn’t make them GenAI phones since when you use the ChatGPT app on your smartphone, your queries aren’t being processed locally on the device itself. Instead, whatever you type into the ChatGPT app is being sent off to OpenAI’s servers to be processed remotely. Likewise, just because you’ve downloaded a generative AI photo app doesn’t mean you have a GenAI phone since remote servers usually do the image generation.

Off the top of my head, based on the four criteria above, only the latest flagships from Google and Samsung even remotely qualify as GenAI phones. This is because the Samsung Galaxy S24 series and the Google Pixel 8 Pro both run Gemini Nano, Google’s scaled-down LLM that can run on the smartphone itself, provided its CPU is powerful enough.

So, yes, this means that even Apple’s flagship iPhone 15 Pro Max can’t be considered a GenAI phone—well, at least not yet.

THE FUTURE OF GENAI PHONES

While only a few flagship smartphones can currently be considered GenAI phones, expect that to change quickly. Next month, Apple will unveil iOS 18, and with it Apple is expected to add generative AI features to some existing iPhones, meaning Apple could soon be the company that has the highest number of GenAI phones on the market despite having precisely none today.

But all iPhones that will receive the iOS 18 update still may not be able to be considered GenAI phones—it’ll all depend on whether the various Apple A-series chips in each smartphone are powerful enough to run on-device generative AI tasks (the iPhone 15 Pro’s chip may be, while the iPhone 13’s chip may not, for example). One thing is for certain, however: The iPhone 16 series, set to be released this September, will be considered GenAI phones—and likely be heavily marketed as such by Apple.

And when it comes to GenAI phones and marketing, expect to be inundated with it going forward. Smartphone sales have been stagnant for years as huge evolutionary leaps have slowed. Every smartphone company on the planet probably sees the generative AI boom as a lifesaver to help them reinvigorate their sales.

But will consumers bite? Counterpoint’s research points to yes. The marketing firm says that while in 2024 only 11% of smartphone shipments are expected to be GenAI smartphones, by 2027, 43% of all smartphone shipments are expected to be GenAI smartphones, and by that same year the GenAI smartphone install base—the number of GenAI phones in use in the world—will exceed 1 billion devices for the first time.

FastCompany