It has been five years since its disastrous foray into the handset business. China Mobile (00941.HK) is leaving the past behind and giving it another try.
Next month, the network operator will launch a self-branded 4G smartphone, called M811, putting itself in direct competition with established players such as Huawei, ZTE Corp. (00763.HK) and Lenovo (00992.HK).
Which begs the question: Can China Mobile pull it off this time?
Perhaps with a low entry price.
Chairman Xi Guohua said most 4G smartphones on the market are too expensive and China Mobile will offer an alternative with more affordable handsets, according to Yicai.com.
The company expects to sell 100 million units this year.
Chief executive Li Yue, who described the group’s renewed handset business as a “primary student” (suggesting it has a lot to learn) is confident about the relaunch.
But independent industry analyst Fu Liang said it won’t be easy.
Despite its past exposure to the handset market, China Mobile is setting foot on unfamiliar territory, Fu said. To compete effectively, it needs to have top-notch software and a fully integrated product research, development and design infrastructure.
In addition, it has to be able to provide up-to-speed after-sales service, predict inventory levels and manage them, Fu said.
If nothing else, China Mobile’s renewed stab at the handset market will help it gauge customer feedback on its entire business.
In 2009, China Mobile launched Ophone to much fanfare. It had a self-designed operating system based on Google’s Android platform.
But the market quickly dismissed it as buggy and the Ophone was killed the next year.
The M811 smartphone will be compatible with the five most popular mobile standards including TDD, FDD and SCDMA.
The company has yet to announce the selling price but it’s likely to come in at at less than 1,000 yuan (US$160).
–- Contact the writer at [email protected]