Analysis of Mobile Terminal Device Market Development: AI Terminal Share in China to Reach 55% by 2024
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Since the emergence of ChatGPT, various general and specialized AI large models have proliferated. With advancements in model compression technologies like quantization, network pruning, and knowledge distillation, the AI computing power of terminal devices such as smartphones continues to strengthen, enabling large models to transition from cloud deployment to terminal implementation.
2024 China Market AI Terminal Share to Reach 55%
AI terminals refer to devices with processors integrated with AI engines. At the inaugural AI PC Industry Innovation Forum, Lenovo Group and IDC jointly released the first AI PC Industry (China) White Paper. The white paper highlights that in the future, everyone will have a personalized AI PC running their own "personal large model," making AI PCs indispensable personal AI assistants for individuals, families, and businesses.
IDC released the Top 10 Insights Report on China's Smart Terminals for 2024, predicting that over 70% of terminal devices in China will feature AI capabilities by 2024, with AI terminals accounting for 55% of the market.
AI PCs are expected to be the first AI terminals to achieve mass adoption, driven by continuous innovation in hardware and content, as well as demand for privacy protection and low latency. Leading PC manufacturers are actively engaged in AI PC-related R&D and collaborations, with 2024 poised to be the first year of large-scale AI PC shipments.
The traditional PC industry ecosystem is built around operating systems, where users interact directly with the system interface to manage and utilize various applications.
In the AI PC industry ecosystem, personal AI agents become the primary interface. Supported by large models and application ecosystems, these agents accurately understand user instructions, provide appropriate feedback, and coordinate across applications to accomplish relatively complex tasks. Model, application, and computing power providers must adapt to the new human-centric demands of AI PCs (terminals), ensuring efficient AI operation in their R&D efforts to meet the needs of the AI PC era.
Mobile terminals, or mobile communication terminals, refer to computing devices that can be used on the go. Broadly, this includes smartphones, laptops, tablets, POS machines, and even in-car computers. However, in most cases, it refers to smartphones or multifunctional smart devices and tablets.
As networks and technologies evolve toward greater bandwidth, the mobile communication industry is moving toward a true mobile information era. Meanwhile, with the rapid advancement of integrated circuit technology, mobile terminals now possess powerful processing capabilities, transforming from simple communication tools into comprehensive information processing platforms. This expansion opens up even broader development opportunities for mobile terminals.
Globally, in 2022, the shipments of laptops, smartphones, and wearable devices were 287 million, 1.395 billion, and 516 million units, respectively, representing year-on-year declines of 16%, 11%, and 3.3%.
Domestically, in 2022, the demand for smartphones in the Chinese market was sluggish, with shipments of approximately 264 million units, a year-on-year decrease of 23.1%. Wearable device shipments maintained growth, reaching 160 million units, a year-on-year increase of 14.3%. The Bluetooth headset market also saw growth, with shipments of about 130 million units, up 8.3% year-on-year.
Analysis of Market Development in the Mobile Terminal Device Industry
The disruptive changes brought about by mobile terminal devices have marked the beginning of the mobile internet industry's development and opened a new cycle of technological and industrial advancement. With the continuous evolution of mobile smart terminals, their influence will rival that of broadcasting, television, and the internet (PC), becoming the fourth major terminal product in human history with extensive penetration, rapid adoption, and profound impact on all aspects of social life.
Mobile terminal devices can not only make calls, take photos, listen to music, and play games but also perform a wide range of functions, including positioning, information processing, fingerprint scanning, ID card scanning, barcode scanning, RFID scanning, IC card scanning, and alcohol content detection.
Mobile terminal devices are the critical entry point and primary innovation platform for internet services, serving as platforms for new media, e-commerce, and information services. They are the most important hub for the interaction of internet resources, mobile network resources, and the environment. Their operating systems and processor chips have even become strategic high points in the entire ICT industry.
The mobile smart terminal industry chain is characterized by intense competition across all segments, with companies continuously innovating and expanding their markets to capture higher profits and market share. For example, in the processor sector, companies like Qualcomm, MediaTek, and Huawei HiSilicon are competing in 5G chips. In the memory sector, Samsung and SK Hynix are competing in 3D NAND flash memory. In the display sector, BOE and AUO are competing in OLED screens. In the camera sector, Sony and Samsung are competing in high-pixel cameras. In the sensor sector, Bosch and STMicroelectronics are engaged in highly competitive battles.
The development of the terminal market will be systematically planned around six major scenarios: entertainment, mobile office, education and learning, fitness and health, smart home control, and intelligent travel. Through deep integration of technologies such as AI, cloud computing, security, interaction and connectivity, and systems and applications, supplemented by supporting services, the industry will better align with user needs and maintain a healthy growth trajectory.
With the enhancement of terminal computing power and the gradual integration of AI acceleration engines into processors, AI deployment in the terminal market is expanding from the cloud to the edge. In particular, model inference and data storage will increasingly be implemented at the edge as terminal performance optimizes.
In the fierce market competition, the ability of enterprises and investors to make timely and effective market decisions is the key to success. The report accurately captures unmet market demands and trends in the industry, effectively avoids investment risks, and more efficiently consolidates or expands corresponding strategic target markets, firmly grasping the initiative in industry competition.