Honor, a Chinese smartphone manufacturer, asserts that the value of AI is null if data privacy is disregarded.

• George Zhao, CEO of Honor, stated in an exclusive interview with CNBC that the transforming power of artificial intelligence is worthless unless user data is safeguarded.
• Apple announced this month that it will begin providing personalized AI tools on select devices in the U.S. this fall.
• "Zhao stated that we maintain the principle of keeping user data within the device."

George Zhao, CEO of Honor, a Chinese smartphone company, emphasized the importance of protecting user data in order for the transformative power of artificial intelligence to be of any value, in an exclusive interview with CNBC on Thursday.

This month announced that it will start rolling out personalized AI tools on certain devices in the U.S. this fall.

Honor already integrates AI functions, such as allowing users to open text messages and other notifications with a glance, and eliminating copy-paste steps by directly linking Yelp-like apps to navigation or ride-hailing apps.

At Mobile World Congress in Shanghai, Honor presented new AI technology for identifying deepfakes in videos and simulating lenses that reduce myopia from prolonged screen time.

Zhao highlighted that Honor's strategy is to restrict AI operations involving personal data to smartphones, which is commonly referred to as on-device AI, in contrast to AI tools that utilize cloud computing for operation.

"Data security and user privacy protection are crucial for AI to be valuable," Zhao stated in Mandarin, as translated by CNBC. "This has always been one of our core principles."

"Zhao stated that we maintain the principle of keeping user data within the device."

Apple Intelligence, the iPhone company's AI product, utilizes on-device processing and leverages "server-based models" for more intricate demands. Apple stated that its new "Private Cloud Compute" does not retain user data.

Honor claims that its on-device AI is independently developed, and the company is collaborating with both Google and Amazon Web Services for other AI functionalities.

"Zhao stated that AI development has been progressing in two directions. While network [cloud] AI has grown increasingly powerful, he believes that on-device AI will continue to empower consumers and improve its understanding capabilities."

He stated that it would offer consumers greater assistance and facilitate their engagement with the upcoming AI era.

Many generative AI applications, including OpenAI's ChatGPT, need more computing power than a smartphone's battery can provide.

The use of the cloud raises concerns about the security of data transmission.

Balancing AI capabilities with energy usage and data privacy is a "gigantic challenge" for manufacturers, Zhao stated.

A system that collects a large amount of user data to provide more personalized features is considered "stronger" than an individual using the system.

Our aim for the future evolution of smartphones is to empower the user, stated Zhao.

"As an object gains strength, it will showcase the insignificance of the individual in its presence. I believe mobile end devices should empower and enable individuals."

The Honor's Magic V2 folding phone, launched in China last summer and Europe earlier this year, won the "Best Smartphone in Asia Award" at the Shanghai MWC this week.

The Magic V2 folds up nearly as thin as an iPhone.

The Magic V3, equipped with the latest AI functions, is set to be released by Honor in July.

Zhao responded, "Of course, we need to challenge ourselves, right?" when asked if the new foldable would be even thinner.