The move, the BI report said, could be a way for Apple to introduce AI to mobile devices in China after the country blocked its Apple Intelligence, which was released by the tech giant in the US two months back.

Officials said Apple must tie up with local AI companies for it to be able to deliver the new features in China as a matter of compliance with local rules.

Apple has yet to roll out the full suite of Apple Intelligence features planned for its iPhones, BI said in its report. So far, the company has introduced a limited number of functions, among them OpenAI’s ChatGPT for Apple’s Siri voice assistant.

Apple CEO Tim Cook recently said the company plans to roll out more AI features in April.

Apple has also discussed partnering with Baidu to roll out AI features on iPhones in China, but technical disagreements reportedly stalled progress, BI said citing report by The Information early this month.

The tech giant has been attempting to shake off competition from Chinese tech companies, Huawei and Xiaomi. According to the BI report, Apple has had a “rough time” in one of its key markets and missed projected sales in Greater China during the last quarter.

Apple is looking at encouraging consumers to upgrade to new iPhones that support the AI features.

Analysts have predicted that the iPhone16 would drive a massive upgrade cycle.