ZTE and Huawei - both Chinese handset makers - are catching up in the smartphone industry and are anticipating market entry in Korea.
A quick briefing on the two companies:
Huawei - a telecom equipment manufacturer based in Shenzhen. In the fourth quarter of 2012, they surpassed Research in Motion and Nokia in terms of smartphone shipments (10.8 million smartphones).
ZTE - the second-largest Chinese telephone equipment maker. Has a new lineup of premium handsets running on the fourth generation LTE. Likely to increase smartphone shipments also.
Why have these Chinese rivals not been active in releasing their smartphones in Korea? Despite their strong growth in sales and shipments overseas, the Korean market is seen as an investment market rather than a profit-making market.
Better recognition of Chinese smartphones also need to be made; Huawei will be making premium products instead of low-end ones and are currently developing one-chip-based models and customizing the designs to suit the Korean market. Additional market research must be conducted for these companies, but they are both considering cost competitiveness and excellent after-sales services.
ZTE released “Z Phone” through Korea's online shopping site G-market last year. So far, a total of 6,000 Z Phones have been shipped to Korea as of early February, 2013. They are currently looking at the possibility of success and mapping out plans to reveal a second smartphone model.
ZTE has been gaining market share in domestic (China) and overseas market (especially in Africa) - their phones are considered 'low-end' but cost less than $161. ZTE released its flagship LTE smartphone called "Grand S" in January at the International Consumer Electronics Show in Las Vegas.
Both Huawei and ZTE will need to work on getting their phones more widely acknowledged - but considering that Koreans (read: IT trend lovers) use mostly Samsung or Apple phones, their strategy will have to be articulated in an intelligent and most importantly, cost-efficient way. In other words - an in-depth market analysis would be necessary before entering the 'risky' Korean market.
Since November 2009 when Apple's iPhone was launched, the global smartphone industry has seen many changes. Samsung Electronics rose as the world’s biggest handset manufacturer and the world's no.1 smartphone vendor with 63.7 shipments and 29% market share in the fourth quarter.
Apple followed with 47.8 million shipments and 22% market share. Huawei was ranked third with 10.8 shipments and a nearly 5% market share. ZTE was fifth, shipping 9.5 million smartphones in the fourth quarter. Once-strong IT giants (namely Nokia, RIM and HTC) fell from the list of the top five global brands in an extremely short period of time - it will be interesting to see how these figures change at the end of the year.