Canalys predicts that AI-capable PCs in Mainland China will take off in 2024 and reach 33 million units by 2028, accounting for 73% of the PC market. In the AI PC era, PC manufacturers in Mainland China face unprecedented unique opportunities. Microsoft's Copilot lacks a local implementation roadmap in Mainland China, which greatly limits the interest of consumers and enterprise users in adopting AI functions and products. However, this has also provided PC manufacturers and other industry participants with plenty of opportunities to innovate, experiment, and optimize the development and landing strategies of AI PCs in the Mainland China market.

Since 2023, the Chinese central government has vigorously advocated for “new quality production forces”, highlighting innovation in all industries and igniting enthusiasm for adopting new technologies and innovating in traditional economic sectors. A series of measures by technology companies and the government have made Chinese society generally open and optimistic about adopting AI technology. Consumers and small and medium-sized enterprises (SMB) have also shown a positive attitude towards AI-enhanced applications. However, due to limited resources, small and medium-sized enterprises are eager to directly integrate AI into their business operations through flexible and plug-and-play solutions.

Canalys' latest PC end-user survey shows that in Mainland China, many large enterprises have developed clear guidelines to integrate GenAI into their workflows, and this level of AI involvement surpasses that of Western countries such as the United Kingdom, the United States, and Germany. Large companies engaged in internet services and IT infrastructure, such as technology companies, have advanced digital capabilities and are accelerating the adoption of AI technology. However, some relatively traditional industries, such as some manufacturing industries, still need to establish their own digitalization foundation and are not fully prepared for AI.

For state-owned enterprises and government agencies, local procurement regulations and the current development of domestic chips bring some limitations to the promotion of end-side AI. However, at the same time, Mainland China's telecommunications companies are investing heavily in cloud infrastructure and focusing on developing AI models on the cloud. This shift may promote the development of cloud-based solutions, thereby reducing the dependence on hardware devices such as PCs.

To expand the Mainland China AI PC market, PC manufacturers mainly adopt two strategies: 1. Providing the original version of AI PC directly, which includes AI PC with standard Windows functionality and high-performance hardware (such as Intel's Core Ultra and Qualcomm's Snapdragon X Elite). These PCs do not include advanced AI functions but rely on Windows 11 upgrades to drive sales. Due to the lack of product differentiation, this approach may put manufacturers in a defensive position. In addition, the landing of Copilot in Mainland China is uncertain, and the availability of ordinary AI PCs may be limited due to the underdevelopment of AI software and applications, and may also result in a high dependence on cloud-based AI functions, thereby reducing their attractiveness. 2. Integrating self-developed or third-party AI functions into computers. The second strategy focuses on developing proprietary AI functions and establishing an AI application ecosystem. Manufacturers such as Lenovo and Asus are adopting this approach and developing their own AI agents and applications, such as Lenovo's AI agent "Little Sky Assistant" or Asus's AI creation application "StoryCube". This strategy requires a lot of investment in the development and maintenance of AI applications and cooperation with local development ecosystems to create a strong AI ecosystem. In addition, some smartphone manufacturers are trying to leverage their platform-level development expertise to equip their devices, from smartphones to PCs, with innovative AI functions and enhance connectivity and communication between their device ecosystems.

To fully take advantage of the AI PC boom in Mainland China, manufacturers need to adopt flexible and open methods. Establishing a solid partnership with local software companies and adapting to the unique market development characteristics and trends in different regions of Mainland China will be key to capturing growth opportunities. As the AI PC market continues to develop, strategic innovations and the ability to adapt to local markets will determine the success of participants in this vast market.

There are mainly two strategies for PC manufacturers to expand the AI PC market in Mainland China: 1. Directly provide the original version of AI PC, which includes AI PC with standard Windows functionality and high-performance hardware (such as Intel's Core Ultra and Qualcomm's Snapdragon X Elite). These PCs do not include advanced AI functions but rely on Windows 11 upgrades to drive sales. Due to the lack of product differentiation, this approach may put manufacturers in a defensive position. In addition, the landing of Copilot in Mainland China is uncertain, and the availability of ordinary AI PCs may be limited due to the underdevelopment of AI software and applications, and may also result in a high dependence on cloud-based AI functions, thereby reducing their attractiveness. 2. Integrating self-developed or third-party AI functions into computers. The second strategy focuses on developing proprietary AI functions and establishing an AI application ecosystem. Manufacturers such as Lenovo and Asus are adopting this approach and developing their own AI agents and applications, such as Lenovo's AI agent "Little Sky Assistant" or Asus's AI creation application "StoryCube". This strategy requires a lot of investment in the development and maintenance of AI applications and cooperation with local development ecosystems to create a strong AI ecosystem.

To expand the AI PC market in Mainland China, PC manufacturers mainly adopt two strategies: 1. Providing the original version of AI PC directly, which includes AI PC with standard Windows functionality and high-performance hardware (such as Intel's Core Ultra and Qualcomm's Snapdragon X Elite). These PCs do not include advanced AI functions but rely on Windows 11 upgrades to drive sales. Due to the lack of product differentiation, this approach may put manufacturers in a defensive position. In addition, the landing of Copilot in Mainland China is uncertain, and the availability of ordinary AI PCs may be limited due to the underdevelopment of AI software and applications, and may also result in a high dependence on cloud-based AI functions, thereby reducing their attractiveness. 2. Integrating self-developed or third-party AI functions into computers. The second strategy focuses on developing proprietary AI functions and establishing an AI application ecosystem. Manufacturers such as Lenovo and Asus are adopting this approach and developing their own AI agents and applications, such as Lenovo's AI agent "Little Sky Assistant" or Asus's AI creation application "StoryCube". This strategy requires a lot of investment in the development and maintenance of AI applications and cooperation with local development ecosystems to create a strong AI ecosystem.

To fully take advantage of the AI PC boom in Mainland China, manufacturers need to adopt flexible and open methods. Establishing a solid partnership with local software companies and adapting to the unique market development characteristics and trends in different regions of Mainland China will be key to capturing growth opportunities. As the AI PC market continues to develop, strategic innovations and the ability to adapt to local markets will determine the success of participants in this vast market.

To succeed in the Mainland China market, manufacturers must meet the unique needs of different segments of the market, such as consumers, small and medium-sized enterprises, government, and state-owned enterprises.

Canalys' minimum requirements for AI PC are: desktops or laptops with a dedicated chipset or module to run end-side AI workloads. Examples of dedicated chipsets include: AMD's XDNA, Apple's Neural Engine, Intel's AI Boost, and Qualcomm's Hexagon.

Canalys predicts that AI-capable PCs in Mainland China will take off in 2024 and reach 33 million units by 2028, accounting for 73% of the PC market.