2024

Million

Rise

<p>The integration of generative AI (GenAI) services into local devices marks a significant shift in the technology landscape, with on-device processing poised to become the new standard. Analyst firm IDC projects a remarkable surge in the adoption of AI-enabled PCs and smartphones, estimating a total of 295 million units by the end of 2024, up from a mere 29 million units in 2023.</p>
<h2 class="wp-block-heading" id="rise-of-on-device-ai">Rise of On-device AI</h2>
<p>Driven by advancements in dedicated AI accelerators and neural processing units (NPUs), manufacturers are equipping devices with the capability to process AI tasks locally. This move away from cloud-based processing heralds a new era of efficiency and autonomy in AI technology.</p>
<p>GenAI smartphones are expected to dominate the market, constituting a staggering 240 million units of the projected 2024 shipments. These devices, armed with AI cores and accelerators, empower users with on-the-go AI capabilities, enhancing user experiences and opening doors to a myriad of AI-driven functionalities.</p>
<p>AI PCs, while experiencing a notable uptick in adoption, are estimated to reach 54.5 million units by the end of the year. Despite the lower volume compared to smartphones, AI PCs are positioned to capture a significant share of the market, accounting for 22% of shipments in their respective categories.</p>
<h2 class="wp-block-heading" id="implications-for-industry-players">Implications for industry players</h2>
<p>As on-device GenAI capabilities become ubiquitous, technology vendors face the challenge of differentiation in a crowded market landscape. With the standardization of AI processors across devices, the traditional avenues for creating unique selling points and driving increased revenues are increasingly constrained.</p>
<p>According to Ranjit Atwal, Senior Director Analyst at Gartner, the rapid proliferation of on-device AI will compel vendors to adapt, integrating AI capabilities into their offerings to remain competitive. However, this shift may not translate into substantial increases in end-user spending, as anticipated price increases could offset potential benefits.</p>
<h2 class="wp-block-heading" id="opportunities-and-challenges">Opportunities and challenges</h2>
<p>While the surge in on-device AI adoption presents opportunities for innovation and enhanced user experiences, software vendors must navigate the transition and harness the full potential of on-device AI. The integration of AI into software applications requires time and effort as vendors strive to demonstrate the tangible benefits of on-device AI to end-users.</p>
<p>The meteoric rise of on-device GenAI capabilities signifies a paradigm shift in the technology landscape, with smartphones and PCs poised to become AI powerhouses. As industry players gear up to embrace this transformation, the path forward entails both challenges and opportunities, ultimately shaping the future of AI-driven innovation.</p>

GenAI Smartphones and AI PCs to Reach 295 Million Units

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