China Wireless aims for China's No 1 spot

Firm says low-cost smartphones will help it pass Samsung and Lenovo in the mainland market

PUBLISHED : Friday, 26 April, 2013, 12:00am
UPDATED : Friday, 26 April, 2013, 4:14am

China Wireless Technologies, the mainland's third-largest smartphone vendor, believes demand for low-cost phones will help it eventually overtake the market leaders, Samsung Electronics and Lenovo.

A 50 per cent surge in smartphone shipments will allow China Wireless to pass Lenovo for the No2 spot this year, though catching Samsung will take longer, chief financial officer Jiang Chao said yesterday.

"Lenovo's share is only 2 per cent higher than our company, so we will catch up to them very fast," Jiang said in Shenzhen. "This year we could catch up with Lenovo, but Samsung will be another few years in the future."

China Wireless surged to third place in the smartphone market in the three months to September, up from sixth in the preceding quarter, according to the researcher IDC. That was the first time the company entered the top five. For 2012, Samsung led the mainland smartphone market with a 17 per cent share, against 11 per cent for Lenovo, IDC data showed. China Wireless did not rank among the top five for the full year.

Mainland smartphone shipments will rise 44 per cent to 300 million units this year, driven by handsets costing about 700 yuan (HK$870), IDC forecast in December. Demand is surging as China Mobile, the world's largest carrier by subscribers, aggressively encourages users of second-generation networks to upgrade to third-generation services with low and middle-end smartphones. China Wireless, formed in 1993, has sold phones through China Mobile for a decade.

Yuji Fung, a Hong Kong-based analyst with Oriental Patron Financial, said: "Unlike Lenovo, which may rely more on open market channels, China Wireless's strong business relationship with domestic telecoms operators secures a high level of shipment growth. Strong smartphone growth is driven by the operator channel at the moment, via handset subsidies."

China Wireless will boost smartphone shipments to 30 million units this year, and 40 million units next year, from more than 20 million units last year, Jiang said. Samsung shipped 37.1 million smartphones in China last year and Lenovo 23.5 million, according to IDC.

Jeffrey Shafer, a spokesman for Lenovo, said: "We are highly confident that we will continue to build on our momentum in China smartphones and in fact our global smartphone, tablet and PC businesses."