With a triple-camera system and clever AI capabilities in its new flagship device, Huawei has bold designs on stealing away market share from Samsung and Apple. Will it succeed? John Kennedy reports.
After sampling the various smartphones on show at Mobile World Congress (MWC) 2018 recently, it became clear that many players in the market are struggling to differentiate themselves.
They all have standard and plus-sized screens, 4K HDR cameras, impressive audio and most of them run on Android. Sony stood out from the pack for its high-res audio and dynamic vibration system, while the updates in Samsung’s S9 and S9 Plus just felt iterative or too subtle to make you want to splash out impulsively.
‘As Huawei fights for a return on investment from its research and development, significantly undercutting its two closest competitors is no longer an option’
– DOMINIC SUNNEBO
With its iOS platform, Apple – which is never at MWC but somehow manages to offer one of the biggest phones at the show – is understood to be struggling with sales of its highly priced iPhone X, which it launched alongside the iPhone 8 and iPhone 8 Plus. Recent rumours of a new colour for the iPhone X to shore up sales have been swirling.
Chinese rival Huawei – which has pretty much come from nowhere several years ago to become the third-biggest player in the smartphone world by revenue (second by volume) – held off on launching its new P20 until yesterday (27 March) in Paris, in what appears to be a bold effort to shake up the smartphone world.
The inclusion of a notch on the front screen seems to be a nod to Apple, but that’s where the similarities end.
The device features three Leica lenses at the back – a first in the smartphone world – offering a whopping 40 megapixels and including a colour sensor, the ability to record in slow-mo, and artificial intelligence stabilisation (AIS), which is capable of object recognition and understanding shapes. The latter is made possible through the inclusion of a neural processing unit on a Kirin 970 chipset. It will come in two sizes: 5.8in and a 6.1in P20 Pro.
The device certainly throws down the gauntlet to Apple and Samsung in the market and it will be interesting to see if the Chinese company can make inroads against the two leaders. It certainly is not shy about its ambition, as Huawei president for western Europe, Walter Ji, made clear in a recent interview with Siliconrepublic.com.
Will Huawei surpass Apple and Samsung in the smartphone market?
Huawei is chipping away patiently but firmly through innovation.
According to the latest Strategy Analytics figures, Apple’s iPhone still commands the majority of revenues from the smartphone segment, at 51pc. Samsung gleans 15.7pc of the revenues but the one to watch closely is Huawei, which now commands 7pc of global smartphone revenues.
According to Dominic Sunnebo, global director at Kantar Worldpanel ComTech, Huawei’s investment in R&D – estimated at $10bn a year – is the crouching tiger in this affray.
While the US is currently anti-Asia in terms of 5G technology – Trump recently moved to block the Broadcom acquisition of Qualcomm – the one thing holding Huawei back is US telcos such as AT&T toeing the Cold War-esque line about fears of Asia surpassing US technology.
It is an ironic stance when you consider most iPhone devices from Apple are made by Foxconn in Shenzhen, where Huawei is also headquartered.
“When you ship over 150m smartphones a year, your days of being described as a challenger are numbered,” Sunnebo said. “So, while Huawei’s ambitions to surpass Apple and Samsung might seem bold, its heavy investment in research and development suggests there’s real depth to what it wants to achieve.
“The P20 series could demonstrate the fruits of Huawei’s labour. The continued partnership with Leica will deliver not only real photographic innovation, but also lend some much-needed brand recognition to Huawei in markets where it is less well known, like the UK.”
Sunnebo said that with the P20, Huawei is trying to hold its own among the top tier. “The P20 series appears to be replicating some of the design attributes of Apple’s latest releases, such as the screen notch – though, with a stream of Chinese manufacturers already copying this feature, Huawei shouldn’t really need or want to follow suit.”
As more investment is ploughed into R&D, it seems inevitable that the prices of Huawei devices will rise.
Currently priced at €649, the P20 is considerably cheaper than the iPhone X, which currently starts at $999 (€1,179).
“The P20 series is likely to be a highly attractive proposition for consumers around the world, though, as Huawei fights for a return on investment from its research and development, significantly undercutting its two closest competitors is no longer an option. As smartphone innovation has slowed in recent years, it can no longer be relied upon to attract customers.
“This means brands are increasingly focused on premiumisation and the higher margins this brings as a way to make up for lower volumes.”
Time will tell if Huawei’s patience will be rewarded but, when it comes to analysis of the actions of the various players in this market, the smartphone war is showing no signs of letting up any time soon.