ZTE won't follow Huawei with consumer device brand campaign

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BARCELONA, Spain--ZTE does not intend to follow Chinese rival Huawei in launching a major brand campaign for its consumer devices business, said a senior ZTE executive. The company said instead it will allow its carrier partners to bring its hero devices to market.

In an interview with FierceWireless here at the Mobile World Congress trade show, ZTE USA CEO Lixin Cheng said the company is not going to produce a TV advertising campaign for its brand and will stick to its "B2B2C" strategy of partnering with carriers. 

"We are not going to spend billions of dollars to just burn the money to ... increase brand awareness," he said. "It's not our character, it's not our strategy."

Huawei this week announced its latest high-end device, the Ascend P2, which it called its fastest quad-core smartphone yet. The company also unveiled a consumer-facing brand and the slogan "Make it possible," which it plans to promote heavily. The effort is similar to the branding push HTC engaged in several years ago through the "quietly brilliant" tagline in order to boost its smartphone sales.

Cheng said ZTE's results during the past two years prove that it does not need to conduct a major branding campaign. According to IDC, ZTE was the No. 4 smartphone vendor worldwide in the fourth quarter, with 9.5 million units shipped, just behind Sony Mobile Communication' 9.8 million. IDC said ZTE was also the No. 4 overall handset maker worldwide in the fourth quarter and for all of 2012.

The ZTE USA chief said the company plans to double the number of models it releases in the U.S. market compared to last year to around 25. He said the majority of the company's shipments in the U.S. market last year were smartphones and the majority this year will be LTE smartphones. On a global basis, the company wants to increase its smartphone shipments to 50 million this year, and expects smartphones to make up 70 percent of its devices sales.

Cheng said ZTE will introduce both its high-end, Android-powered Grand S and Grand Memo smartphones in the U.S. market this year under the ZTE brand. Interestingly, he also said ZTE might bring its "Open" Firefox OS phone to the U.S. region, even though Mozilla CEO Gary Kovacs indicated this week that the platform will not launch in the United States until 2014. "We might launch this phone in U.S. if we can find a home for it," Cheng said.

Both ZTE and Huawei were stung last year by a U.S. government report that said they pose a security risk because their equipment could be used for espionage, which Huawei and ZTE vigorously disputed. The report said that the companies' mobile devices did not pose a security threat.

Cheng said "the tangible impact [of the report] is that it actually helped us increase our brand awareness." He said there was a "short-term PR crisis" around the news, but that it made "people start looking at us" and they saw that ZTE made high-quality phones.

"I do believe we have the secret recipe to increase our brand awareness," he said. "The last two years have proven our strategy is working."

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