The 2024 Year-End Battle of Domestic Smartphones: AI Takes the Crown, Price Hikes Prevail, Who Can Be the 'iPhone Alternative'?

The 2024 Year-End Battle of Domestic Smartphones: AI Takes the Crown, Price Hikes Prevail, Who Can Be the 'iPhone Alternative'?Every year after the release of the new iPhone, a wave of high-end domestic smartphone launches follows, driven both by competition and a desire to undercut Apple. 2024 is no exception

The 2024 Year-End Battle of Domestic Smartphones: AI Takes the Crown, Price Hikes Prevail, Who Can Be the 'iPhone Alternative'?

Every year after the release of the new iPhone, a wave of high-end domestic smartphone launches follows, driven both by competition and a desire to undercut Apple. 2024 is no exception. Following the September 10th release of the iPhone 16 series, domestic smartphone manufacturers have unveiled their annual flagship models, kicking off a year-end battle.

A Price Hike Wave: Rising Supply Chain Costs, Consumers Foot the Bill

This year's battle exhibits several clear trends, the first being a collective price increase. The vivo X200 series, OPPO Find X8 series, Honor Magic7 series, and Xiaomi 15 series have all raised prices by 200-300 yuan.

The root cause of the price hike lies in the rising costs of the supply chain. The new generation of flagship smartphone chips produced using TSMC's N3E process have seen a significant increase in cost. For instance, the purchase cost of the MediaTek Dimensity 9400 and Qualcomm Snapdragon 8 Elite has risen to 1084 yuan and 1328 yuan, respectively, with the Snapdragon 8 Elite still costing 22.5% more than the Dimensity 9400.

On the other hand, consumer purchasing power for high-end smartphones is also steadily increasing. Counterpoint Research data shows that global high-end smartphone sales grew by 6% year-on-year in 2023, reaching a historical high. The high-end market share is close to 25%, with sales revenue accounting for nearly 60%.

AI Takes Over Imaging, Becoming the New Battlefield of Competition

In recent years, smartphone imaging has been a key battleground for manufacturers. However, with the increasing homogenization of features, smartphone AI is emerging as a new competitive frontier.

In 2024, OPPO, Meizu, and other manufacturers have officially announced entering the AI smartphone era, propelling AI as a core strategy into the market. Other manufacturers are also integrating AI functionality into their latest flagship models, such as the OPPO Find X7 series, Huawei Pura70 series, vivo X200 series, Honor Magic7 series, and Xiaomi 15 series.

The applications of smartphone AI mainly focus on intelligent assistants/voice assistants, system-level deep integration, and the richness of AI functionalities. For example, OPPO's "One-Click Ask Screen" feature necessitates the integration of multi-modal interaction, requiring the coordination and integration of AI platform resources, demonstrating system-level AI integration.

Apple has also launched its AI service, Apple Intelligence, placing AI at the core.

The Race to Be the 'iPhone Alternative': Price Wars Ignite, Who Will Prevail?

While each manufacturer has presented their flagship models as competitors to the iPhone 16, the "alternative" strategy is discreetly unfolding.

The flagship models of OV, Honor, and Xiaomi, the main selling models, are priced below the starting price of the iPhone 16, aiming to capture market share from iPhone users.

However, becoming an iPhone "alternative" is not easy. The price war could put pressure on OV, Honor, and Xiaomi from Apple. On October 21st, the iPhone 16 series saw official price reductions, with discounts reaching up to 1600 yuan, expected to steal users from their competitors.

Conclusion: Technological Innovation is King

In the 2024 year-end battle of domestic smartphones, AI will be the new focal point of competition. Each manufacturer is exploring the deep integration of AI with phone systems. The price war adds further dynamism to the market.

Whether through price hikes or "alternatives," technological innovation will ultimately decide the winner. Only by consistently improving product capabilities and user experience can companies emerge victorious in this fierce competition.