In the first week of March, VCPost reported that Apple sales declined in China due to Huawei's market domination. To boost consumer confidence in buying Apple products, the big tech company offered massive discounts on iPhone 15 models and invested $139 million in a product development lab.

A recent report from South China Morning Post, it has been disclosed that Apple is set to integrate Baidu's AI technology into its upcoming iPhone 16 and other products destined for the Chinese market. 

This decision came after Apple CEO Tim Cook's visit to Shanghai to address the sales decline in the country. He also inaugurated a new retail outlet in the city and engaged with key suppliers to reaffirm the company's commitment to the Chinese market. 

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Behind Chinese AI Technology from Baidu's Integration to iPhone 16 and More

To clarify, however, Apple still plans to use its own AI model outside China. Only it will rely on locally-developed technology for the mainland. 

With this move, Apple is deliberately working closely with Chinese companies like Baidu to use their advanced AI technology in products designed specifically for Chinese consumers. However, this collaboration is happening when AI companies face increased regulatory attention in China, indicating changes in how AI is regulated and overseen by the government in the country.

At the same time, U.S. companies are also bracing for China's attempt to level the playing field in terms of company reach in the country after the TikTok ban bill was approved.

READ MORE: Apple CEO Tim Cook Visits Shanghai as Pressure Mounts on China Sales