Analysts doubt Huawei can ascend smartphone ranks
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E-mail China Daily, June 20, 2013
Chinese telecom giant Huawei Technologies Co Ltd spared no effort to market its latest flagship smartphone, the Ascend P6, worldwide, but analysts doubt if it will achieve its goal of challenging Apple Inc and Samsung Electronics Co Ltd in the high-end range.
Huawei chose London as the first global stop to promote the Ascend P6, an Android-based 6.18 mm thin device, on Tuesday.
The elaborate decorations, glamorous models and throngs of reporters and invited guests were on par with similar marketing campaigns by Samsung and Apple.
Yu Chengdong, chief executive officer of Huawei Consumer Business Group, said Huawei aims to sell 10 million units of the Ascend P6 globally, with about half the sales from the domestic market.
"We haven't reached so many units for a single smartphone before, but we are struggling to catch up with Apple and match the competition," Yu told China Daily.
The device is priced at 449 euros ($602), less than the latest iPhone handset, which costs 529 pounds ($828) in the United Kingdom. However, in China, the same smartphone goes for only 2,688 yuan ($438).
Wang Weijun, China president of Huawei Device Co, a terminal branch of Huawei, said the Ascend P6 drew 1.68 million reservations during the first five days after Huawei opened online bookings.
"We plan to invest 100 million yuan in marketing the Ascend P6 in China during the first three months," Wang told China Daily. He stressed that Huawei will use both online and offline channels.
The Ascend P6 is Huawei's latest product in its uphill fight against top-level smartphone manufacturers such as Apple and Samsung. But analysts expressed doubts about whether the company could truly reach its goal.
"There is no Chinese mobile phone player that has succeeded in selling high-end smartphones," said James Yan, senior analyst at research firm IDC.
Apple had sold about 6 million units of the iPhone 4 and 9 million of the iPhone 4S in China by March, according to IDC.
The best results achieved for Huawei's high-end devices so far are for the Ascend P1, which sold 260,000 units in China.
The chances of Huawei's Ascend P6 beating Apple's iPhone handsets or Samsung's Galaxy S4 in China are almost zero, a Beijing-based mobile phone analyst, who asked not to be identified, said.
"Compared with Samsung, Huawei smartphones lack branding, and the distribution capability is weaker," he added.
The best sales record of a single Huawei mobile device is for the Huawei C8650, which sold about 6 million units in the domestic market, according to IDC figures. But the C8650 is in the entry-level category, which usually sells much better than high-end smartphones.
Wang of Huawei denied Chinese media reports that Huawei hopes to sell more than 6 million units of the Ascend P6 in the domestic market, but said he is confident that the customized version of the Ascend P6 on China Mobile Ltd's network will surpass 1 million units.
Linda Sui, an analyst with Strategy Analytics, said the Ascend P6 holds a pricing advantage over similar category rivals of other brands. Therefore, the device may be attractive in the mature European and US markets.
Founded in 1987, the Shenzhen-based Huawei is the world's second-largest telecom gear maker by revenue.
It was the world's fourth-biggest smartphone vendor by shipments in the first quarter of 2013, after Samsung, Apple and LG, according to IDC.
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