Wireless Smartphone Strategies

The industry’s most comprehensive set of critical market statistics and qualitative analysis, tracking and reporting on smartphones.

April 22, 2015 20:24 nmawston

Following Day One at the global Huawei Mobile analyst event in China, compared to the first day where there were a lot of keynote speeches, Day Two events were separated by a couple of different tracks ranging from consumer business, enterprise business, enabling ICT transformation and SDN, through to digital business innovation. Our analysts from our Wireless Smartphone Strategies (WSS)service joined the consumer business track.

As stated in our Day One blog, "connection" is the keyword for this event. In its consumer business, Huawei plans to give consumers a “smart life” in the future with solutions of wearables, smart homes and vehicle-mounted devices for the connected person, connected home and IoT, by centering on smartphones to create a consistent user-experience. Huawei has cooperated with various wearable partners such as Tencent, Baidu, Codoon, Jawbone, Google, Myfitnesspal, Auto Navi and Boohee. It also partners with Mercedes and Audi in vehicle-mounted devices.

For wearable devices, Huawei currently provides two products: Talkband B2, which is released in China on April 22nd and begins to sell on April 23rd, and its predecessor Talkband N1. Huawei will also launch (slightly delayed) its Watch in the third quarter of this year. There will be three colors of Huaweil Watch: gold, silver and black, with 40+ watchfaces. It is a full-circle outlook, with a 42mm diameter, Sapphire crystal cover, 1.4-inch AMOLED display with 400x400 screen-resolution. It will be sold outside China first due to the well-known Google (Mobile Services) issue in China.

As smartphone products will still be centric to its consumer business, Huawei will still pay a lot of attention to this segment in the future. Huawei targets more than $40 billion revenue and 15% marketshare for its global smartphone division in 2019. Huawei will maintain its dual-brand (Huawei and Honor) smartphone approach, but it plans to reduce its number of products and focus on technical innovations to improve product competitiveness and sales volume of single models.

Huawei plans to grow its revenue of the smartphone segment from overseas to be over 60% in 2015 and higher in the future (currently around 50%). To achieve this goal of global development, it will continue investing in global retail stores, promoting the Honor brand outside China, and enhancing Huawei’s brand image and global influence by high-end marketing, Internet marketing and emotional connections.

To be sure, 2
014 was a banner year for Huawei and it has kept on doing very well in the first quarter of 2015. Will this momentum continue into 2016? It will depend on its "connection" with the whole ecosystem.


April 21, 2015 08:48 lsui

 There are over five hundred analysts and media worldwide attending Huawei's 12th Global Analyst Summit in Shenzhen, China, today. Our analysts from our Wireless Smartphone Strategies (WSS) service also joined the event.

The key theme of Day One is about the corporate overall performance review and strategy outlook. Looking in the rearview mirror, 2014 was a banner year for Huawei. Financially, company overall-revenue increased +21% YoY to RMB 288.1 billion (US$46 billion). Company overall-profitability also improved, with 9.7% net profit in 2014, up from 8.8% in 2013, mainly thanks to a streamlined organization and management structure, as well as improved average selling prices (ASP).

The operator business still made up the lion’s share (67%) of overall group revenue, but consumer (26%) and enterprise (7%) divisions have been growing faster in 2014. The consumer business group (smartphone, dongles, and other products) posted RMB 75.1 billion (US$12 billion) revenue in 2014, up 33% YoY, leading the pack among all three business groups.

Geographically, China contributed to 38% of total revenue in 2014, up from 35% in 2013, mainly thanks to the uptake of 4G LTE in China. Europe, Africa, Middle East, Asia Pacific and Latin America also saw healthy growth. In contrast, its North America performance remains lackluster and saw a decline last year.

For the smartphone business, in which Huawei ranked the third largest smartphone vendor by volume worldwide in 2014, according to a report from our Wireless Smartphone Strategies (WSS) service, Huawei reiterated its commitment to the sector but indicated it will continue focus on profit rather than scale. Compared with the two industry giants Apple and Samsung, the operating margin on Huawei's smartphone business is still quite slim, so there is scope for growth. Our Wireless Smartphone Strategies (WSS) service tracks the world's top-16 smartphone vendors by value and profitability on a quarterly basis in this extensive report.

Moreover, Huawei outlined some initiatives to upgrade the service-driven platform for its smartphone products, including building up offline-service networks, building a full-service online platform in key cities across 100+ countries, as well as establishing an operational excellence center (OEC) to realize synergy across online and offline channels.  We look forward to more details in the Day Two session tomorrow.

Connection is the keyword for this event. “Open road to a better connected world” is their slogan and can be seen everywhere at this event. We understand it refers to the connection between Huawei and customers, between consumers and service / product providers, between people and people, and between IoTs, etc. In the Consumer business, will Huawei extend into a more cross-product connected ecosystem, from its current smartphone and dongle-focused product lineup? How will Huawei execute its service-driven platform to provide consumers with full-lifecycle services? Please stay tuned for our Day Two blog.

 

 


February 11, 2015 06:30 nmawston

As expected a few months ago, the world's first Ubuntu smartphone will finally be launched commercially today, Wednesday 11th February, 2015. Right before Mobile World Congress (MWC), the cellphone industry's biggest annual tradeshow.

The device in question is a repurposed BQ E4.5 mid-tier Android model -- but with Android software replaced by Ubuntu.

The new device will be distributed online (in Western Europe only) in a "flash sale" today, followed by three more such events by the close of February.

The BQ Aquaris E4.5 Ubuntu Edition has a 4.5-inch screen, 1GB RAM and dual-SIM connectivity. The hardware specs are good, but not groundbreaking, at that midrange pricepoint.

There will also, eventually, be a Meizu MX4 Ubuntu model launched in China in H1 2015. Meizu is currently the 11th largest smartphone vendor in China.

For the apps ecosystem, Ubuntu does not yet have a recognized apps store, but it does offer "scopes" that are single-screen windowpanes / homescreens on the handset for apps and services. For example, there is a "scope" (app) for Web-browsing, social networking, and so forth.   

BQ is a top-10 smartphone vendor in Spain. Like Wiko France, Xiaomi China and Micromax India, BQ Spain is a "local" smartphone vendor that is attempting to gain marketshare through local apps, local distribution and good, old-fashioned hardware price-cuts. So far, BQ has grown relatively well at home in Spain, but its international presence outside the country is tiny.

It is good to see innovation from Ubuntu, but BQ's (and Meizu's) new device will NOT worry the likes of Apple and Samsung. The BQ Ubuntu phone has limited global distribution, a limited apps ecosystem, limited developer support and limited hardware-vendor support. Our WSS (Smartphones) service forecasts Ubuntu to account for just 1% share of all smartphone shipments worldwide in 2015. Ubuntu will struggle to make headway in the crowded smartphone market.


November 6, 2014 05:25 woh

Samsung, the world's biggest smartphone vendor by volume, has officially announced a new duo of premium-looking metal smartphones, A3 and A5, at the end of October, 2014 and is planning on hard-launching them in November in select markets, mostly emerging markets, such as China at affordable price-points to address the mounting competition from local vendors. A3 and A5, which are the first two smartphones under the category of the new Galaxy A series, are believed to target the younger and first-time smartphone users in the growing emerging markets, with nice-looking metal unibody design, modest specifications and mid-ranged prices.

In addition to the metal design, it would be worth noting that these mid-priced smartphones are featuring 4G LTE connectivity and 5MP secondary camera, which is better than 3.7MP on more premium Galaxy Note 4. We believe that Samsung is taking on a selective marketing for the younger generation who wants to enjoy the faster data services on the faster 4G network, and spends much time to take the "selfie" photos in developing regions. There has been no words on the more advanced Galaxy A7 model, but will be expected to come with higher display resolution and stronger feature-sets later on.


October 2, 2014 23:21 lsui

According to a new report from our Wireless Smartphone Strategies (WSS) service -- Global Smartphone Sales by 17 Technologies : 2007 -2017 -- HSUPA / HSPA+ will be replaced by LTE as the world's most widely used smartphone air-interface technology in 2015.

We forecast 4G technoligy to account for 38% of total global smartphone sales in 2014, rising to 45% in 2015. Moreover, LTE-Advanced will entend into more markets from 2014 onwards.

China will surpass USA to become the largest LTE smartphone market globally in 2014.

 


September 3, 2014 01:33 lsui

According to a new report from our Wireless Smartphone Strategies (WSS) service -- Value Share : Global Smartphone Revenue and ASP by Vendor by Price-Tier : Q2 2014 -- Lenovo became the world's largest smartphone vendor by volume in the entry-tier category in the second quarter of 2014. This is a first for the company.

However, we note the vast majority of Lenovo's smartphone shipments are generated in its home market of China. Outside China, Lenovo remains a tiny second-tier smartphone brand at the moment.

More analysis of Lenovo and smartphone shipments by price-tier can be viewed by clients here.


April 24, 2014 16:23 lsui

LTE, branding and retail-point expansion are the three keywords for Huawei's global smartphone business in day 2 at its annual analyst event this week. Our smartphone team is attending.

LTE is the most important growth driver for Huawei's 80 million smartphone target in 2014. China, Western Europe, as well as other emerging markets, will play a determining role in its global LTE landscape. Our Wireless Device Strategies (WDS) service tracks global LTE phone volume and value (wholesale revenues and ASPs) on quarterly basis in this report.

Branding enhancement is an on-going project for Huawei over the past few years. Shfiting from product-centric to consumer-centric is their highlight for this year.

Open-channel retail-points have been playing an increasing role during Huawei's transition from a previous ODM / operator-centric business model to an OEM / own-branded business model. This year, Huawei will further solidify its global retail presence by setting up more branded shops, display zones and tables worldwide. The online channel for phones is burgeoning in China at the moment, however, we will not see a quick take-off of e-commerce in many emerging markets elsewhere very soon, so physical retail stores will maintain their critical role in both operator channels and open channels. Huawei's commitment on retail expansion is, in effect, a practical way to fulfill its global growth target this year. This published report, from our Wireless Smartphone Strategies (WSS) service, forecasts smartphone sales by 7 channels for 6 regions and 3 major countries (China, India and Japan).

 


January 17, 2014 19:33 nmawston

According to our Wireless Smartphone Strategies (WSS) service, the global Tizen smartphone installed base will be a niche proposition in 2014 / 2015. Can Samsung get the new mobile operating system off the ground in places like Japan and Western Europe? Can it avoid a "Bada 2.0" scenario?

This extensive published report, available to clients, forecasts global smartphone sales, by 14 operating systems for 88 countries worldwide, from 2007 to 2018. Almost every major country worldwide is covered, including the United States, China, India, Indonesia, Japan, South Korea, Russia, Brazil, Mexico, South Africa, Saudi Arabia, UK, Germany, France, Italy, Spain and others.



October 28, 2013 18:06 nmawston

According to the latest research from our Wireless Smartphone Strategies (WSS) service, global smartphone shipments grew 45 percent annually to reach a record 251 million units in the third quarter of 2013. Samsung captured a record 35 percent share of all smartphone volumes worldwide, while Huawei jumped into third place in the rankings.

Global smartphone shipments grew 45 percent annually from 172.8 million units in Q3 2012 to 251.4 million in Q3 2013. This was the first time ever that smartphone shipments exceeded a quarter-billion units in a single quarter. Smartphones accounted for 6 in 10 of all mobile phones shipped worldwide. The smartphone industry’s robust growth is being driven by strong demand for LTE models in developed regions like the US and 3G devices in emerging markets such as China.

Samsung grew 55 percent annually and shipped a record 88.4 million smartphones worldwide, capturing a record 35 percent marketshare in Q3 2013. Samsung shipped over two times more smartphones than Apple during the quarter. While shipments of the flagship Galaxy S4 model softened, solid demand for the new Note 3 phablet and for mass-market devices like the Galaxy Y helped to lift Samsung’s volumes.

Apple shipped 33.8 million iPhones worldwide in Q3 2013, up from 26.9 million a year earlier. Apple grew just 26 percent annually during Q3 2013, which is around half the overall smartphone industry average of 45 percent. Apple’s global smartphone marketshare has dipped noticeably from 16 percent to 13 percent during the past year. Nonetheless, we expect Apple to rebound sharply and regain share in the upcoming fourth quarter of 2013 due to high demand for its new iPhone 5s model.

Huawei was a star performer as global shipments grew 67 percent annually to 12.7 million units in Q3 2013. Huawei captured 5 percent marketshare and became the world’s third largest smartphone vendor. The popular P6 and G610 models have been among the main drivers of Huawei’s success. Huawei remains very strong at home in China, but its position is less robust in other major markets like the US and Europe. Huawei will need to expand aggressively in the American and European markets if it wants to seriously challenge the big two of Samsung and Apple next year.

Other findings from our research include:

LG shipped 12.0 million smartphones worldwide for 5 percent marketshare in Q3 2013. LG grew 71 percent annually, making it the fastest-growing vendor among the top five brands. LG has been expanding rapidly in Europe, but China and India remain weak spots;

Lenovo shipped 10.8 million smartphones worldwide for 4 percent marketshare and fifth position in Q3 2013. Lenovo is popular among mass-market consumers in China and it is expanding internationally. Two of the world’s top five smartphone vendors came from China -- Lenovo and Huawei.


 Exhibit 1: Global Smartphone Vendor Shipments and Market Share in Q3 2013  [1]

Global Smartphone Vendor Shipments (Millions of Units)

Q3 '12

Q3 '13

Samsung

56.9

88.4

Apple

26.9

33.8

Huawei

7.6

12.7

LG

7.0

12.0

Lenovo

6.4

10.8

Others

68.0

93.7

Total

172.8

251.4

 

 

 

Global Smartphone Vendor Marketshare  %

Q3 '12

Q3 '13

Samsung

32.9%

35.2%

Apple

15.6%

13.4%

Huawei

4.4%

5.1%

LG

4.1%

4.8%

Lenovo

3.7%

4.3%

Others

39.4%

37.3%

Total

100.0%

100.0%

 

 

 

Total Growth Year-over-Year %

44.0%

45.5%

 

The full report, Huawei Reaches Third Place as Global Smartphone Shipments Reach Quarter-Billion Units in Q3 2013, is published by the Strategy Analytics Wireless Smartphone Strategies (WSS) service, details of which can be found here: http://tinyurl.com/bps9qhr.


Please contact Neil Mawston, at nmawston@strategyanalytics.com, for further analysis, data or information.

[1]  Numbers are rounded.


July 17, 2013 13:33 nmawston

According to our Wireless Device Strategies (WDS) service, wearable devices are emerging as a new growth wave for the mobile industry. Companies like Google Glass, Sony, Samsung, Pebble and Jawbone are driving the market. From smart watches to fitness bands to smart glasses, dozens of new models are being launched worldwide.

What are the opportunities and threats for wearables? How big is the market? This published report, available to download by clients, answers those questions and more.