Xiaodu Technology, the smart speaker unit of Chinese tech heavyweight Baidu Inc, has officially released its education-oriented smartphone equipped with an artificial intelligence-powered large language model that is targeted at students, in a bid to carve out a niche in the world's largest smartphone market.

Jing Kun, CEO of Xiaodu Technology, said the new smartphone, called Xiaodu Qinghe, will provide AI-enabled tutoring, English-speaking training and interactive learning guidance for primary and middle school students, as the company aims to extend its footprint in the education hardware segment.

Jing said Baidu's AI large language models will be applied to the company's intelligent terminal devices, such as tablets, smart speakers and headsets in the future. The phone is installed with numerous free learning resources and offers parental controls that can limit the time spent on specific apps. It will go on sale on e-commerce site JD starting next Monday, Xiaodu said.

Xiaodu is the developer of Duer-OS, a voice assistant system based on AI that supports television, speakers and other smart home appliances. Xiaodu topped the list in smart speaker shipments last year in China, according to market research firm International Data Corp. The company has expanded its product portfolio to include smart screens, tablets, headsets and televisions.

Xiang Ligang, director-general of the Information Consumption Alliance, a telecom industry association, said Xiaodu has accumulated some advantages in AI-related software technologies and hopes to integrate its smart voice interaction capabilities into a wide range of hardware devices.

The smart gadget market for children is a thriving niche in China as parents hope to apply such devices to help improve their kids' academic performances, Xiang said, while noting it is an inevitable trend that AI large language models will accelerate their applications in various industries.

Data from IDC showed that 65.4 million units of smartphones were shipped in China in the first quarter of the year, down 11.8 percent year-on-year. The market continued its double-digit decline since the first quarter of 2022.

Oppo climbed to the top spot with a 19.6 percent market share, while Apple dropped to second place, accounting for a 17.6 percent share in China's smartphone market, followed by Vivo and Honor, which secured third and fourth places and took up 17.3 and 16 percent of market shares, respectively.

Li Yingtao, an analyst with Beijing-based internet consultancy Analysys, said as an internet company, Baidu falls short in experience in hardware product manufacturing and may encounter challenges in expanding its retail channels and brand development as the competition in China's smartphone market is heating up.

The launch of an AI-powered smartphone aligns with Baidu's strategy to bet big on AI amid a worldwide frenzy surrounding ChatGPT, an AI chatbot launched by US startup OpenAI last November.

In March, Baidu introduced Ernie Bot — its AI-powered large language model and ChatGPT-like product — which boasts capabilities in fields such as literary creation, business writing, mathematics and understanding the Chinese language. Ernie Bot can be used for a range of functions, including searches, autonomous driving and smart devices.

Generative AI will have a profound impact on people's lives and work and a batch of tech companies both at home and abroad have joined the rush to launch ChatGPT-like products and services, said Zhong Zhenshan, vice-president of IDC China.

However, the exploration of generative AI technology is still at a nascent stage, Zhong said, estimating that such technology will be used for intelligent conversation, marketing and searches.

Amber Liu, a research analyst with market consultancy Canalys, said, "Although there will not be a significant recovery of the Chinese smartphone market in 2023, we have observed signals of consumer confidence returning, which will be a good time for vendors to implement their latest branding and product strategies."