Chinese vendors Huawei and ZTE are both hoping to make a splash in the U.S. smartphone market by releasing high-end devices that carry their own brands. The strategy marks a break for both companies, which have previously sold phones in the U.S. market carrying carrier brands.
Huawei is bringing the Ascend Mate2 to the U.S. market as its first smartphone sold in the market without a carrier label or specific carrier customization. Huawei is also selling the phone through its new online store, gethuawei.com. The device will be sold unlocked for $299 and supports AT&T Mobility (NYSE: T) and T-Mobile US' (NYSE:TMUS) networks, including for LTE.
The Ascend Mate2 was unveiled in January at the Consumer Electronics Show and Huawei vowed to bring it to the U.S. The 6.1-inch device runs on Android 4.3 and sports a 1.6 GHz quad-core processor from Qualcomm (NASDAQ:QCOM). Impressively, the phone can support virtually all of the world's various wireless network technologies, from HSPA to CDMA to TD-SCDMA to LTE (both the TDD and FDD varieties). The phone also features a number of somewhat unique functions: It offers reverse charging, where users can connect another phone to the phablet to charge it; it can remotely take pictures when paired with another device; and it offers a 5-megapixel front-facing camera. But perhaps the most impressive feature is the gadget's large 3900mAh lithium polymer battery that lets users enjoy 12 hours of continuous web surfing on a single charge.
Huawei also announced that Zhiqiang Xu was named president of Huawei Devices USA; previously he served as president of the company's devices business for the Central Eastern Europe and Nordic region, where he worked with operators including Vodafone, Telefónica, Deutsche Telekom and Orange.
Despite the success Huawei has had in making inroads in Europe, Xu told The Verge it took Huawei a year and a half to build its brand awareness in Europe and have carriers "accept" the company's brand. The company needed to raise its profile Europe, and to do so it sponsored soccer teams, among other brand activities. "Today we don't have any problem if we launch the phone [in Europe] with our own brand," he said.
However, in the U.S., where Samsung Electronics and Apple (NASDAQ: AAPL) dominate thanks to massive marketing budgets, Huawei is taking a different tack. Xu said "we think the end user pays too much, they contribute to marketing budgets. We don't think they should have to do that." Instead, Huawei will focus on digital and social media and online activities to build brand awareness.
Xu also said the indirect sales channel, bypassing carriers, "is probably going to be the future," and that U.S. carriers' recent moves toward device financing and away from the traditional subsidy model will open up more direct-to-consumer e-commerce opportunities. However, Xu told The Verge that the firm's future U.S. efforts will include both direct sales and partnerships with carriers.
Huawei was the No. 3 smartphone player in the world in the first quarter, according to research firm IDC. The company shipped 52 million smartphones in 2013, below the 60 million figure Huawei had forecast. However, Huawei is expecting 80 million smartphone shipments globally in 2014.
Meanwhile, ZTE scored a win with U.S. Cellular (NYSE:USM), which is launching the ZTE Grand S Pro for $99.99 with a two-year contract. The gadget runs Android 4.3 and has a 2.3 GHz Qualcomm Snapdragon quad-core processor, LTE and an 13-megapixel camera.
"The Grand S Pro proves that it is possible to deliver a high-performing device, without the high price tag," ZTE USA CEO Lixin Cheng said. "This smartphone showcases ZTE's definition of value which goes far beyond cost to deliver smart, affordable, quality choices."
The Grand S Pro also sports a 5-inch, 720x1280 HD display, Dolby Digital Plus surround sound and camera settings similar to those found in professional cameras such as metering and focusing separation. With ZTE's My Easy Access feature, the camera and other frequently used apps can be opened from the lock screen.
ZTE expects to release more branded devices in the U.S. in the second half of the year.
- see these two separate Huawei releases
- see this The Verge article
- see this ZTE release
Analysts: Huawei, Lenovo and LG dig into Samsung and Apple's market share
Huawei ships 52M smartphones in 2013, again misses its own target
Huawei announces Ascend Mate 2, promises to bring to U.S. market
ZTE turns to LTE to regain ground in smartphones
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