Mainland handset makers emerge to challenge mobile big guns

Multinational mobile-phone handset makers will soon face challenges from emerging mainland manufacturers eyeing expansion into the United States market, according to Wavecom, a French wireless standards developer.

Wavecom managing director Jean-Charles Andreani said Chinese manufacturers were already competing head-on with foreign handset makers in the domestic market and 'certainly have the vision to enter the US market'.

Mr Andreani believed emerging handset firms would follow in the steps of white goods manufacturers such as Haier Group - China's largest maker of household appliances - in expanding overseas to compete with world-renowned brands.

'Some of our clients already have plans to enter into the US market,' he said, adding that technology components of some domestic handset manufacturers had reached a level comparable with major global players.

Some Chinese handset manufacturers had adopted a business model similar to that of personal computer makers, outsourcing their core wireless technology to wireless solution providers and enablers, allowing them to enjoy short product development cycles and higher production yields.

This business model enabled emerging handset makers to enjoy lower production costs than giant handset makers such as Nokia, which builds everything itself.

Mr Andreani said China's handset makers were expanding fast, having raised their share of the domestic market from 3 per cent in 1999 to 13 per cent last year.