TLDRs;
- ByteDance and ZTE are preparing a second Doubao AI phone for 2026.
- The new device strengthens Doubao’s system-level AI integration across mobile apps.
- Developers can gain early advantage by integrating apps with Doubao’s expanding ecosystem.
- OEM resistance and competition may limit Doubao’s wider adoption by 2026.
ByteDance is reportedly moving ahead with a second-generation Doubao AI smartphone, developed in partnership with Chinese device maker ZTE and targeted for a late 2026 release, according to supply chain reports. The decision follows the swift sellout of its first-generation model, an experimental device capped at roughly 30,000 units, which ByteDance positioned as a controlled market test.
The limited run was not intended to signal a major shift into hardware manufacturing. Instead, it allowed ByteDance to observe real-world performance of its Doubao AI assistant when embedded deeply at the system level. With the trial phase now complete, production on the initial version has ended as the company pivots fully to the next device.
ByteDance Bets on OS-Level AI
Rather than building its own smartphones outright, ByteDance continues to emphasize a platform-first strategy, embedding Doubao across devices made by established hardware partners. The upcoming ZTE model is expected to showcase deeper OS-level integration, enabling the AI assistant to perform coordinated actions across separate applications, such as booking restaurants, checking prices, and managing travel arrangements.
Analysts view this approach as ambitious given the tight control major phone makers maintain over their native ecosystems. Morgan Stanley recently noted that Apple, Huawei, and Xiaomi are likely to double down on their own AI assistants, which could limit ByteDance’s influence at the operating-system layer.
IDC China has also cautioned that by 2026, ByteDance may face difficulty securing partnerships with top-tier manufacturers, potentially restricting Doubao’s distribution, even as the assistant reached 159 million monthly active users as of October.
Cross-App Automation Drives Developer Opportunity
While OEM-level adoption remains uncertain, developers stand to benefit from Doubao’s growing capabilities. Apps in categories such as commerce, payments, entertainment, and travel can plug into Doubao’s cross-app orchestration system, enabling the assistant to perform multi-step tasks automatically.
During the first-generation phone’s trial period, Doubao demonstrated its ability to check prices across shopping platforms, handle restaurant reservations, and coordinate interactions between multiple apps. These capabilities hint at a broader ecosystem opportunity, particularly for app developers able to integrate early.
Software-as-a-Service (SaaS) providers may also gain momentum by adopting Doubao-compatible APIs. IDC estimates that Volcano Engine, ByteDance’s cloud and enterprise division, accounted for 49.2% of China’s public cloud LLM API calls in the first half of 2025. This level of usage suggests a strong developer pipeline ahead of the 2026 hardware release.
Enterprise Tools and Middleware to Benefit
As Doubao spreads across more third-party devices, demand will rise for middleware that simplifies AI integration. Companies offering SDKs, automation layers, and system-bridging tools could see significant growth, especially as brands look to avoid costly custom development.
Local reporting indicates that ByteDance is targeting 20 billion yuan in revenue for Volcano Engine in 2025, with middleware offerings expected to support that expansion.
A Strategic Step, Not a Hardware Pivot
Despite the attention surrounding its ZTE partnership, ByteDance maintains that it does not intend to become a smartphone manufacturer. The second-generation Doubao phone reflects a broader strategy: scaling the assistant through software integration rather than proprietary devices.
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