"Apple Inc.'s ( NASDAQ: AAPL) new flagship iPhone 17 hits stores today. Its stock is down 5% this year, compared to an increase of 12% in the S&P 500. The launch will test whether people are willing to buy the new iPhone before Apple releases its AI-powered iOS product. Apple faces three difficult hurdles. The first is that several AI products on the market can be downloaded onto iPhones."
"Apple's next problem is whether the iPhone 17 is enough of an upgrade over the iPhone 16. One new version is super thin. For the most part, however, the primary improvements are in the camera and the chip. Most people cannot tell the difference between a slightly better camera and Apple's current one. A faster chip also will make no difference for most buyers."
"The iPhone 17's largest challenge may not be in the United States. China is the world's largest smartphone market. Four local companies-Huawei, Vivo, Xiaomi, and Honor-have large market shares. Each has AI features of its own. The iPhone has been at the top of the smartphone food chain most years since its launch in 2007. Eighteen years is a long, long time in the consumer electronics business. Each year, Samsung challenges it for first place globally."
Apple released the iPhone 17 as its new flagship while the company's stock lags the S&P 500 this year. The launch will face an upcoming AI-powered iOS offering. Multiple third-party AI apps, including Google's Gemini, are available on iPhone, risking crowding out Apple’s AI. Hardware changes in the iPhone 17 focus mainly on a thinner variant, improved camera, and a faster chip, likely imperceptible to most buyers. In China, Huawei, Vivo, Xiaomi, and Honor hold strong market shares and offer their own AI features. Samsung's lead in foldables adds further competitive pressure. Poor iPhone 17 performance would force Apple into a less dominant global position.
Read at 24/7 Wall St.
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