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Summary
Mobile devices developed with hardware and software capabilities to execute generative AI (GenAI) models and features, commonly referred to as GenAI smartphones, are set to disrupt the business and consumer device landscape in a big way. Companies such as Qualcomm and MediaTek that produce smartphone processors, or systems on a chip (SoC), are ramping up production of processors that can run native, on-device GenAI models. These devices deliver and process GenAI capabilities locally via the native phone experience, enabling users to take advantage of AI-powered features such as image processing, video editing, voice transcription, translation, and new content generation across a diverse set of apps and interfaces. The local compute power, coupled with the native experience offered by GenAI smartphones, will help usher in new business use cases and a democratization of how AI is used in businesses.
What is the business value?
Core to the business value of GenAI smartphones is how these devices will support businesses in improving employee collaboration, communication, and productivity. Additionally, GenAI capabilities will make content consumption and creation easier on devices. As more GenAI smartphones become available and are adopted over the next few years, more mobile apps and native mobile experiences will also emerge, ushering in more intuitive and empowering mobile experiences. Utilization of GenAI beyond siloed in-app experiences and at the hardware level will also help democratize the use of the technology to the broader workforce and help eliminate some of the cost barriers that currently exist due to the current in-app GenAI license fees. Improving how employees interact with mobile devices and apps, in addition to delivering more personalized mobile interfaces and experiences are other benefits delivered via GenAI smartphones.
Elevating employee experiences
GenAI smartphones will advance employee experiences by delivering features that will improve overall employee collaboration and productivity. Smarter on-device support agents, personalized content, mobile-OS-level AI features, and interaction via natural language are examples of features that will be integrated into in-app and native (voice and messaging) experiences. These capabilities will broaden the use of GenAI across frontline and back-office workers, give rise to new mobile experiences, and help accelerate the return on investment (ROI) associated with mobile technologies by advancing utilization. While smartphones have long been an important content consumption device, natural language processing will also make them a more important and intuitive endpoint for creating content.
Capturing new data
Businesses will be in a position to collect vast amounts of work and behavioral data as smartphones continue to become devices that more employees rely on to get work done. When harnessed effectively and processed responsibly, this data will provide businesses with powerful insights that should be yielded to deliver better and more personalized employee services.
Advancing mobile app development
Developers will be able to create mobile apps that leverage powerful and native on-device AI capabilities. Native smartphone GenAI will open up opportunities for new types of mobile apps in much the same way as features such as the native phone camera, touchscreens, and geolocation technologies did previously. This will create possibilities for those developing apps to build on top of native smartphone AI capabilities as opposed to having to develop their own.
Data privacy and security
Processing more data on the device at the edge delivers speed and experience benefits, but it also presents new risks associated with how data and large language models are processed and stored locally. Smartphone manufacturers and mobile app developers that leverage GenAI capabilities must ensure that this new generation of device is equipped with security capabilities that protect sensitive business and user data. Mobility management and security will become an even more important business activity as more compute moves from cloud services to mobile devices at the edge.
Connectivity and the MNO opportunity
GenAI smartphones will also drive demand for faster and more reliable mobile connectivity, which will be welcomed by telcos. Although GenAI smartphones will process more data on the device (or at the edge), this will also drive demand for better connectivity across other services. Enhancing services to support seamless integration between the device and network infrastructure represents an opportunity for mobile network operators. In action, this integration will help businesses deliver even richer employee experiences, as on-device capabilities will make it possible to process data quickly in providing real-time feedback and guidance around work and tasks. This data can then be transferred across a mobile network to a centralized system that can deliver more extensive data analysis based on inputs and insights from the broader workforce.
Where are we with GenAI smartphones?
Flagship models boasting dedicated AI computing power are now entering the market. History has shown that as consumer technologies, especially smartphones, experience strong market adoption and growth, traction and use of these technologies in a business context also increases (for example, bring-your-own-device or BYOD). This activity tends to happen irrespective of whether IT departments officially sanction the adoption and use of these technologies (for example, with shadow IT). Omdia believes this will also be the case with GenAI smartphones; employees will increasingly use their own personal GenAI smartphones for work purposes as they become more aware of the benefits. Technology market analysts at Canalys project that by 2024, 5% of smartphones shipped will be AI-capable, with that number expected to rise to 45% by 2027 (see Further reading). This growth will be driven by the demand for differentiated user experiences and technological advancements in the flagship smartphone segment.
Challenges and considerations
This piece has outlined the potential of GenAI to optimize business operations and employee experiences, but there are challenges organizations must also consider, especially as the use of these devices grows. Many of these challenges center around security and cost. From a security perspective, processing more and potentially sensitive business and employee data on the device and at the edge requires the correct security practices and protocols to be in place. Mobility management and security practices and technologies will provide vital support for businesses here. It is also important to ensure that the security of mobile devices is consolidated as part of a broader business approach and strategy toward cybersecurity. Cost is another challenge. As employee demand for GenAI-powered mobile devices (such as smartphones, tablets, and laptops) grows, businesses will be under pressure to provide these technologies at a rate that is out of sync with a hardware refresh cycle. While the easy solution may be to ignore the growing demand and stick to the usual 3–5 year hardware refresh cycle, this may result in heightened levels of unsecured BYOD activity from employees. Businesses should engage with hardware suppliers in looking for solutions to potentially shorten hardware refresh cycles. Organizations should also revisit BYOD policies and technologies that secure how personal devices access work-related data.
Appendix
Further reading
“60% of PCs shipped by 2027 will be AI-capable,” Canalys (retrieved April 22, 2024)
Author
Adam Holtby, Principal Analyst, Workplace Transformation
