Apple built a custom AI model for China with Alibaba

Apple reportedly developed a custom large language model for the Chinese market in partnership with Alibaba, according to Reuters sources. This marks a departure from Apple's earlier China strategy and gives it more direct control over AI features there.

Why it matters: The deal shows a major US tech company navigating US-China tensions by building China-specific AI infrastructure with a local partner rather than exporting Western models, a workaround regulators on both sides will likely scrutinize. It also deepens Apple's reliance on Chinese AI expertise in a market where Western AI services face restrictions.