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Apple unveiled the iPhone 16 on Monday as the tech giant seeks to breathe new life into its flagship product, betting that consumers will be persuaded to ditch their older devices by a steady rollout of new generative artificial intelligence features.
Chief executive Tim Cook said the latest model was the first of its smartphones to be “designed from the ground up” for artificial intelligence “and its breakthrough capabilities”, as audience members packed into the Steve Jobs Theatre on Apple’s Cupertino campus for its annual product launch event.
The iPhone 16, which will go on sale on September 20 with pre-orders starting this Friday, comes as the tech giant moves to establish itself as a player in artificial intelligence and revive flagging iPhone sales with new generative AI features in its latest operating system, iOS18 — although analysts agreed the launch lacked any major surprises. Apple shares ended the day flat.
Wall Street analysts expect sales of the iPhone will get a boost next year thanks to the new “Apple Intelligence” features, which include an enhanced Siri voice assistant, photo-editing features, writing aids and free access to ChatGPT through a partnership with OpenAI. Monday’s event provided some more clarity on the timing of those launches, which will begin weeks after the first iPhone 16s are sold.
The company announced that some key elements of its Apple Intelligence offering would launch next month in US English, and will be rolled out with “localised English” in the UK, Australia, Canada, New Zealand and South Africa in December. Chinese, Japanese, French and Spanish will be added next year.
These include the enhanced Siri, writing aids, and mail and notification summaries. Together they represent the first wave of AI applications that Apple hopes will transform consumer devices. Apple Intelligence will also be available on iPad and MacBook.
A portal to OpenAI’s ChatGPT on the iPhone is expected to land with users by the end of the year, slightly later than the initial spree of productivity enhancement applications arriving in October.
Apple’s courting of Microsoft-backed OpenAI — including a potential direct investment on the horizon alongside Nvidia, which would value the AI start-up at more than $100bn — emerged earlier this year as investors were starting to voice concerns Apple might be falling behind its competitors.
“We’re very much seeing an arms race in AI,” said Paolo Pescatore at PP Foresight. “We saw it with megapixel cameras, now it’s about who has the best AI platform. Companies like Google, Microsoft, and Meta are making huge investments, and the ROI [return on investment] is still unclear.”
The iPhone 16 will come in four models: the Pro, Pro Max, Plus, and a base model. The Pro and Pro Max have a larger screen and a more advanced camera. The base model will cost $799, the Pro $999 and the larger Pro Max a price tag of $1,199.
The iPhone 16 features the new A18 chip, which will improve performance to handle the demands of running AI models locally on the device. The Financial Times on Saturday reported that the chip had been designed on Arm’s next-generation V9 architecture.
Sribalan Santhanam, vice-president of the company’s silicon engineering group, said the chip showed Apple jumping “two generations ahead”, with the A18 “up to 30 per cent faster” than the processors in the iPhone 15 and even challenging “high-end desktop PCs”.
An enhanced version of the A18 chip in the Pro models of the iPhone 16 will be “the fastest CPU in any smartphone”, he said.
Apple also said the Apple Watch Series 10 would be available from September 20. The company said the Series 10 had a bigger display, thinner design, faster battery charging and a new S10 chip for machine learning. It will come with a new sleep apnoea detection feature, with the company expecting approval from the US Food and Drug Administration “very soon”. Prices start at $399.
The company’s latest AirPods Pro 2 headphones will come with a new hearing aid, a “clinical-grade” hearing test feature and hearing protection, pending FDA clearance.
“The iPhone 16 range is hugely important for Apple at a time when consumer demand for new smartphones is slowing,” said Leo Gebbie at CCS Insight. Apple Intelligence, he said, “will be central to the next decade of the iPhone”.
Following the event, Piper Sandler analyst Matt Farrell reiterated a neutral rating on Apple shares, writing that the event went “largely as expected” and noting that “Apple Intelligence use cases likely still require user education”.
“Bottom line, this is a long-term play for Apple, and while we may not see the bigger impact immediately, Apple Intelligence will eventually change the smartphone user experience completely, like with the first iPhone,” said Nabila Popal at the International Data Corporation.
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