According to the market research report by IDTechEx titled “AI Chips for Edge Applications 2024-2034: Artificial Knowledge at the Edge,” the consumer electronics sector is expected to contribute approximately 45% of the $22 billion revenue projected for the global AI chips market for edge devices.
Various consumer electronics such as phones, tablets, smart speakers, personal computers, and televisions have witnessed significant integration of AI technology. The upcoming trend suggests a proliferation of AI chips in household edge devices to facilitate a localized Internet of Things ecosystem, thereby transforming home environments and interactions with immediate surroundings. Analyzing the trajectory of AI in smartphones provides insights into the future of AI integration in consumer electronics, considering the saturation of the smartphone market, which poses limitations on further AI adoption.
Market Dynamics
The mobile chipset market is highly competitive, dominated by the duopoly of Qualcomm, an American company, and MediaTek, a Taiwanese firm, supplying System-on-Chips (SoCs) to a multitude of mobile device manufacturers. Additionally, companies like Apple and Google develop proprietary chips for their respective devices. Noteworthy developments include Samsung’s transition from utilizing its Exynos SoC to potentially relying on Qualcomm’s Snapdragon 8 Gen 2 for their flagship Galaxy smartphones. On the other hand, Oppo, a major player in the smartphone industry, announced the discontinuation of its semiconductor division named Zeku, signaling a shift towards utilizing Qualcomm or MediaTek chipsets for future smartphone models.
Market Trends
The smartphone market has reached saturation levels in many regions, evident from the global decline in smartphone shipments in 2022. While not all smartphones are equipped with AI coprocessing chips, the top-selling models, primarily from Samsung and Apple, drive a significant portion of the market revenue. The prevalence of AI coprocessing in smartphones is expected to increase, especially in premium models, as advanced smartphones typically incorporate AI acceleration within their processors. This trend aligns with the concept of premiumization, where a higher proportion of premium smartphone sales offset the overall decline in smartphone volume. The integration of AI in smartphones serves as a model for implementing AI technology in other consumer electronic devices, although reaching peak concentration levels in the chipset market may take some time.
In conclusion, the evolution of AI chips in consumer electronics, particularly smartphones, reflects a broader trend towards enhanced AI integration in edge devices, reshaping user experiences and technological advancements in the industry.
