There are still improvements to be made in smartphones and artificial intelligence (AI) will play a critical role in driving further innovation in this space.

There remained significant differences today in terms of the functions offered in a $200- and $1,000-priced smartphone, said Bruce Lee, Huawei's global vice president of handsets business. He dismissed suggestions that innovation in the handset market had plateaued, with little separating low-end and high-end devices, and that manufacturers should move their focus elsewhere.

Speaking to ZDNet in an interview Friday, Lee said Huawei continued to focused its R&D efforts on introducing more functionalities and improving existing capabilities, such as camera, battery life and processing speed. It also needed to ensure its handsets could support faster internet connection, especially when 5G networks become available, he added.

Earlier this year, Pacific Crest's analyst for emerging technologies Ben Wilson opined in a research report, titled "There Is No 'Next Smartphone'", that the smartphone revolution was a "singular event in compute platform history" that was unlikely to repeat. Others also debated the "death of the smartphone" and impact of wearables.

While he acknowledged there was tremendous growth potential in wearables and smart devices, Lee said these still were challenged by the same issues faced in the smartphone market. He pointed to existing limitations in compute performance and battery life.

This further indicated that, far from "dying", there was still some ways to go in terms of smartphone innovation and development, he noted, adding that the industry must continue to invest in these key areas--of improving battery life and compute performance--to enhance user experience.

In this aspect, he said Huawei believed AI would play an important role in the future of handsets and would facilitate many critical developments in smartphones.

In its 2016 annual report, the Chinese manufacturer described an era of "+Intelligence" in which all devices, people, and processes would be supported by AI. "Building intelligence into our devices, networks, and industries will open up new worlds," it said, adding that it would impact the role of smartphones in future.

Huawei believed phones would be able to think contextually and engage humans in dialogue to understand their needs. The devices then could deliver the information and services humans required and would evolve into personal assistants to provide expertise and personalised services.

"AI will disrupt the user experience, but before it can do so, we will need a quantum leap in the functionality of our smart devices, chipsets, and cloud services," it said. "Artificial intelligence will place heavy demands on computing performance, energy efficiency, and device-cloud synergy. Meeting these demands and creating a better intelligent experience will take a synthesis of capabilities across both chipsets and the cloud."

Lee said Huawei had invested heavily in building a development team focused on AI, which included both hardware and software.

"We hope to use AI in our phones to have more learning capabilities...[so], together with big data, we will be able to understand consumer habits and better incorporate voice and image capabilities into the phone," he said. "This will enable the phone to become smarter and offer increased efficiencies for consumers."

Lee also underscored the need to embed this intelligence on the device itself, rather than push data into the cloud to be analysed.

Because machine learning and AI algorithms required significant amount of compute power, much of these processes were carried out in the cloud, and not on the local device, he explained. This, however, was not efficient, he said, stressing the need for more AI capabilities to be supported on the smartphone itself in order to reduce latency.

"We can then have faster responses because we don't need to upload data from the device into the cloud, do the computing, and send it back into the device," he noted. "And when we do the computing on the local device, we can also safeguard user privacy since we don't need to upload data into the server."

In terms of handset performance, Huawei had a stellar start to the year, bypassing Oppo in the first quarter to claim pole position in China's smartphone market. It shipped 20.8 million units, which was up 25.5 percent from the year before, and held a 20 percent market share.

Worldwide, it placed third behind Samsung and Apple, with a 9 percent market share for the first quarter 2017. The Chinese vendor shipped 34.18 million units, compared to Samsung's 78.67 million and Apple's 51.9 million.

Lee attributed the growth to its high-end P and Mate product lines. He further revealed that the company's future growth strategy would see more investment towards its high-end smartphone products.

In addition, Huawei would be looking to increase its market share outside its domestic market. Noting that China contributed about 60 percent of its smartphone business, he said the vendor was targeting for its overseas revenue to outweigh that of its home market.

While Europe currently was its biggest region outside of China, he added that the rest of Asia-Pacific would play a pivotal role in its future growth due to Huawei's geographical advantage in this region. Due to its heritage, it also had a better understanding of Asian consumers so the region should offer higher growth potential, he said.

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Huawei sees AI, not death, in smartphone future - ZDNet