Huawei, ZTE Moves into the Smartphone Market

In the past 10 years, Chinese companies Huawei and ZTE have created waves in the telecom equipment market, drawing market share from established Western companies. Today, the two companies have once again set their sights on smart phones.

Zuma Press Huawei Huawei's Ideos X5 handsets Huawei and ZTE are trying to break into the Smart Phone market and launch their own branded handsets with multiple functions and low prices. Many of these products will run Google's Android operating system. Android is a free operating system that quickly gained share in the wireless market.

At the Mobile World Congress trade show held in Barcelona this week, Wan Wei, president of Huawei's wireless product line, said that the company will launch up to 20 new smart phones this year, up from 10 last year.

Huawei's Smartphone line includes a high-end product with a large screen and at least 10 million-pixel camera. The company demonstrated two products running Android in Barcelona: the Ideos X3 smartphone and the Ideos S7 Slim tablet.

Wan Hao said that in the next two to three years we will be working on smart phone solutions.

ZTE is also entering the smart phone market. The company has historically sold low-cost feature phones primarily in emerging markets, but this year ZTE will expand its lineup and launch smartphones and tablets for the first time in North America.

In Barcelona this week, ZTE demonstrated the flagship smartphone Skate and two other products running the Android operating system. The phone runs the Android operating system and is expected to be available worldwide in May.

Cheng Lixin, president of ZTE North America, said that the company will double its product lineup in North America this year. Last year, ZTE launched 14 products in North America, including 11 mobile phones in the United States.

Different from the past, Cheng Lixin said that ZTE will also strive to build its own brand in North America. ZTE is almost unknown in North America and rarely uses its own brand for mobile phones.

Selling at a discount price is also part of ZTE's strategy. The first-class smartphones that are bound for two-year online contracts are generally worth US$200 in the United States. ZTE said that several smart phones will be launched this year, and the price of binding internet contracts will be much lower than US$200.

The large-scale entry into the lucrative smartphone market is the latest sign of ZTE’s growing position in the mobile phone market. At the end of January, in the ranking of research company IDC, ZTE was the world’s fourth-largest handset supplier in terms of handset sales, ahead of Apple Inc., second only to Nokia. Corp., Samsung Electronics Co., and LG Electronics Inc.

This is the first time that ZTE has pushed into the top five IDC quarterly rankings. In the quarter, ZTE claimed 4.2% of the global mobile phone market, up from 2.8% in the same period of last year.

Although ZTE is developing faster than Huawei in the entire mobile phone market, both companies have to face a difficult path in the field of smart phones.

According to IDC, Huawei said that as of the end of the third quarter of last year, it only accounted for 0.2% of the global smartphone market. ZTE claimed 1.1%.

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