Huawei closes in on Samsung for world smartphone crown

December 24, 2019 14:06
Huawei's first global flagship store is pictured in Shenzhen on Oct. 30. The tech giant has boosted its share in China’s smartphone market, taking it a bit closer to edging out Samsung as the world’s No.1 player in the industry. Photo: Reuters

The smartphone market has been witnessing a massive churn globally in recent years thanks to the rise of a number of Chinese players. Once considered poor imitators, Chinese brands have come into their own, and are now playing a key role in driving the development of the industry. Standing at the forefront and showing the way forward is none other than Huawei.

Despite facing curbs from US authorities, Huawei has done quite well for itself and looks set to move ahead in its goal of overtaking Samsung and becoming the world's No. 1 smartphone maker. 

A market research report recently predicted that Huawei could surpass Samsung to emerge as the world’s biggest smartphone maker by shipment units in 2021, thanks to the firm's strong momentum in both China and overseas markets.

A Korean newspaper, meanwhile, has said Huawei will rank the second in the global smartphone arena this year, surpassing Apple, with 251 million phones for an estimated market share of 17.7 percent by the year-end.

According to another report from Strategic Analytics, Samsung will still be the top phone maker this year with 21.3 percent market share and 323 million units, but the gap between Samsung and Huawei will be just 3.6 percentage points.

Apple, which has been focusing on the premium phone segment, remains in the third position, with shipments seen at 193 million units for 13.6 percent market share.

Huawei managed to improve its performance despite Washington's sanctions which affected sales in the US and Europe. The Chinese tech giant offset the losses in key Western markets with a strong performance at home.

Industry observers have noted that Huawei recorded a sharp increase in market share in China this year after the US trade ban, as the company shifted its resources to the home market.

According to Counterpoint market research, Huawei's market share in China in the third quarter rose to 40 percent, up from 23 percent a year earlier. Meanwhile, other local brands saw their market shares decline as Chinese consumers flocked to Huawei to show their support amid the US ban.

Given the huge share of the China market, the lack of Google mobile service support may not impact too much on Huawei's overall status in the global smartphone arena. While the current market share figures are yet to reflect the actual impact of the US ban on Huawei, it is interesting to note that Huawei has adopted a low-profile approach in promoting its latest flagship model Mate 30 series.

Though the company launched the device in Europe with a special event, the product was yet to be sold in the continent due to the lack of Google services. Huawei knows the lack of Google support is a pain for European users. That could limit Huawei’s growth in some markets in the coming months.

As for Samsung, the company maintains a strong presence in global market thanks to its comprehensive product roadmap in all segments -- entry level, mid-range and the premium segment. The Galaxy S10 series and Note 10 series are still considered one of the best Android smartphones in the market.

However, the problem is that the company has failed to achieve significant market share in China.

Currently, Samsung is not a top 5 or top 10 smartphone maker in the China market. Some market research figures showed that Samsung had less than one percent market share in China. This decline in the sales of Samsung in China is being attributed to the influence of the Chinese brands and the inclination of more and more Chinese users to go for domestic brands. For the second quarter of 2019, the Korean giant shipped around 700,000 units in China, which would account for just 0.7 percent market share.

Samsung's fortunes in China have been on a downward slope in the past few years. In 2016, the company had a 4.9 percent market share which declined to 2.1 percent the following year. Last year, the figure slipped to below 1 percent. Reports indicate that in the first quarter of 2019, the company’s market share in China rebounded somewhat, to 1.1 percent.

The Korean firm said in October that it was shutting down its last phone factory in China, in the southern city of Huizhou. With its share of the Chinese market collapsing amid a rise in labor costs there, the company is now setting its sights on more promising markets.

Samsung's share of the Chinese market has declined steadily since late 2016, when it suffered a steep fall in demand in the wake of the Galaxy Note 7 debacle. Samsung's delayed response to the crisis, which erupted after reports of devices overheating and exploding, led to a severe loss of consumer confidence.

With Samsung losing out in the vast China market, and many Chinese consumers opting for domestic brands out of nationalistic sentiments, it is reasonable to expect that Huawei will further boost its overall global market share in the coming year.

With the gap between the global top two narrowing to just a few percentage points, don't be surprised if Huawei dethrones Samsung as soon as next year to take the world smartphone crown.

-- Contact us at [email protected]

RC

EJ Insight writer