Deutsche Telekom is making a new push into consumer hardware with an AI Phone developed in close collaboration with Perplexity, along with Picsart and other partners. The carrier said the device will be unveiled in the second half of this year, with sales planned for 2026 at a price of less than $1,000.
The project, announced at MWC in Barcelona, is aimed first at the European market. It also comes with a broader software effort: an AI assistant app called Magenta AI.
A carrier wants a bigger role in the phone experience
For Deutsche Telekom, the AI Phone is more than a handset announcement. It is part of a long-running telecom ambition: to have a stronger direct relationship with mobile customers, rather than leaving the most valuable software layer to technology companies.
Apple and Google have long shaped the smartphone experience through operating systems, app stores and device ecosystems. Telecom companies provide the networks, but they have often had less control over apps, interfaces and the daily customer relationship.
Deutsche Telekom has tried similar moves before, including partnerships connected to Mozilla and Facebook. The source article describes those efforts as part of a familiar pattern in telecoms: carriers looking for ways to compete more effectively with technology companies in the mobile world.
The AI Phone is the latest version of that strategy. Instead of trying to create a new mobile ecosystem around traditional apps, Deutsche Telekom is placing the assistant at the center of the device.
Perplexity moves from search answers to phone actions
Perplexity is being presented as a central partner in the development of the phone’s AI interface. The startup is best known for its generative AI search engine, but the announcement points toward a more active role for its technology.
Onstage at the event, Perplexity co-founder and CEO Aravind Srinivas said, “Perplexity is transitioning from just being an answer machine to an action machine.” He described a future in which the assistant can book flights, book reservations, send emails, send messages, place phone calls and set smart reminders.
That distinction matters. A search tool responds to a question. An assistant built into a phone can potentially sit closer to the user’s calendar, communications, travel planning and everyday device habits.
The source article notes that Perplexity has already launched an Android assistant in January. That earlier assistant appears to be a likely template for the AI Phone, although Deutsche Telekom has not yet disclosed all details of the final phone experience.
What Deutsche Telekom has confirmed
Some parts of the plan are clear, while other parts remain open. Deutsche Telekom said the AI Phone will be built in close collaboration with Perplexity, Picsart and others. It also said additional AI services on the device will include AI from Google Cloud, ElevenLabs and Picsart.
The company has not yet shared detailed device specifications. It has also not said who is building the hardware or what operating system the phone will run. The source article notes that concept renderings make it look like a flavor of Android, but Deutsche Telekom said those details would be disclosed in the second half of the year.
Confirmed details include:
- The device is called an “AI Phone.”
- It is being developed with Perplexity, Picsart and others.
- It will be unveiled in the second half of this year.
- It will start selling in 2026.
- It will be priced at less than $1,000.
- It is initially aimed at the European market.
- It will include Magenta AI, Deutsche Telekom’s AI assistant effort.
Claudia Nemat, the Deutsche Telekom board member overseeing tech and innovation, said the company is not building foundational large language models. Instead, she said, “but we do the AI agents.”
Magenta AI extends the strategy beyond one device
Deutsche Telekom is not relying only on customers buying its own phone. Magenta AI will also be available as an app-based version of the assistant for Android and iOS users, as long as they are already among Deutsche Telekom’s 300 million customers.
That gives the company two paths. The AI Phone can present the full, integrated version of the experience, while the app can reach customers who keep their existing devices.
Nemat said the phone will have AI built into the experience, including “AI on your lock screen.” That suggests Deutsche Telekom wants the assistant to be visible at a basic level of phone use, not limited to a separate app that users must remember to open.
For a telecom company, that placement is important. The lock screen is one of the most frequent contact points on a smartphone. If AI becomes useful there, the carrier may have a more meaningful role in the customer’s daily device experience.
A difficult market with strong AI pressure
The smartphone market remains hard to break into. The source article notes that it is dominated by a small number of companies and has seen even major players such as LG step back.
That makes the Deutsche Telekom and Perplexity plan ambitious. A lower-cost AI Phone may attract interest, but it still has to compete in a market where hardware, operating systems, services and customer loyalty are tightly connected.
For Perplexity, the partnership offers a way to stand apart from OpenAI, Anthropic and Google. The company is competing in consumer AI tools while Google has been adding Gemini AI into basic search products. Moving into action-oriented phone services with a telecom partner gives Perplexity a different route to users.
The announcement also reflects the larger AI focus at MWC this year. For Deutsche Telekom, AI is being framed as a path to a stronger consumer position. For Perplexity, the phone is a chance to show that its assistant can do more than answer prompts.