Posts tagged ‘Huawei’

27/01/2016

With China weakening, Apple turns to India | Reuters

As China sales show signs of cooling, Apple Inc (AAPL.O) is touting India’s appetite for iPhones, betting that rising wages and an expanding middle class will pull consumers away from the cheap alternatives that currently dominate the market.

In an earnings call in which the company reported meager iPhone growth and forecast its first revenue drop in 13 years, the Indian market stood out as a rare bright spot for Apple.

Sales of the company’s flagship smartphone climbed 76 percent in India from the year-ago quarter, Apple Chief Financial Officer Luca Maestri said.

According to data compiled by Counterpoint Technology Research, Apple sold an estimated 800,000 iPhones in India in the fourth-quarter, its highest ever amount but one that is a fraction of the 28 million smartphones sold during that period.

Growth in India is a tantalizing prospect as Apple grapples with the economic downturn in China, its second largest market. While revenue in Greater China rose 14 percent in the last quarter, Apple is beginning to see a shift in the economy, particularly in Hong Kong, Maestri told Reuters in an interview.

But with nearly 70 percent of smartphones selling for less than $150 in India, Apple’s high-end phones remain out of reach of most consumers. The basic iPhone 6S sells at just under $700 in India, or nearly half the average annual wage.

“In many ways India is very similar to what China was a few years ago, but the middle class here is still very small and it can be two to three years before Apple gets a similar level of success in India,” said Counterpoint Technology Research analyst Tarun Pathak.

Apple CEO Tim Cook struck a more optimistic note, saying the company was “increasingly putting more energy” into India, citing a largely youthful population with rising disposable income as more people join the workforce.

With faster 4G coverage expanding, Apple has already asked Indian government for a license to set up its own retail stores just as the market seems to be turning in its favor.

As in China, Apple products are a coveted status symbol in India, a market that analysts say is likely to overtake the United States next year to become the world’s second largest smartphone market. “The love for the iPhone is there,” said Carolina Milanesi, chief of research and head of U.S. business at Kantar Worldpanel ComTech, a consumer research firm.

Source: With China weakening, Apple turns to India | Reuters

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12/08/2015

India’s Smartphone Market Is Booming – Especially at the Low End – India Real Time – WSJ

Xiaomi Corp., which announced Monday that its some of its phones are now being assembled at a factory in India, isn’t the only Chinese smartphone maker with its eye on the subcontinent.

With the Chinese economy slowing and demand for smartphones picking up in India, Chinese handset makers including Lenovo Group Ltd.0992.HK +1.70%, Huawei Technologies Co. and Gionee Communication Equipment Co.  are looking to produce and sell more phones in the world’s second-most-populous nation.

But Indian consumers prefer cheaper phones than their Chinese counterparts. Roughly half of smartphones sold in India for the three months ended in June cost less than $100. In China, these low-end smartphones accounted for about 20% of the market over the same period, according to research company International Data Corp. IDC predicts the average selling price of Indian smartphones will fall to $102 in 2018 from $135 in 2014.

The $100 Galaxy J1 and other inexpensive handsets drove sales for Indian smartphone market-leader Samsung Electronics Co.005930.SE 0.00%, helping to increase its share of sales to 23% of the smartphones sold during the quarter ended June 30. In other markets, including China, sales are driven by its flagship Galaxy S6 and Galaxy S6 Edge, which sell for around $600 and $700, respectively, in the U.S.

Smartphone penetration is growing rapidly. While Internet penetration levels in India resemble China’s numbers from six years ago, smartphone penetration is only four years behind, according to a Credit Suisse report. The skyrocketing growth has even caught the attention of Apple Inc.AAPL -5.49%, which recently started offering financing to make its iPhones more accessible to Indians.

That might be bad news for smartphone manufacturers who operate on already razor-thin margins, but it’s potentially good news for Indian consumers and the Indian economy.

It also helps explain why contract manufacturing giant Foxconn says it intends invest billions of dollars setting up factories in India, and why Xiaomi recently announced its first made-in-India smartphone, the $107 Redmi 2 Prime. Changes to tax rules now make it cheaper to manufacture electronics in India. It also shortens the supply chain, meaning phone-makers can get their products to consumers faster and reduce inventory costs.

via India’s Smartphone Market Is Booming – Especially at the Low End – India Real Time – WSJ.

10/08/2015

5 Things to Know about Foxconn’s Overseas Ambitions – WSJ

Foxconn, Apple Inc.’s major assembler, has signed a preliminary deal with India’s Maharashtra state to invest $5 billion in factories and research facilities in coming years. But the company, officially known as Hon Hai Precision Industry Co., has a history of making ambitious statements and floating investment ideas that haven’t materialized. Here are five things to know about Foxconn’s overseas ambitions.

Deutsch: Foxconn Logo

Deutsch: Foxconn Logo (Photo credit: Wikipedia)

1 India isn’t its first billion-dollar bet

In 2011, Foxconn agreed to invest $12 billion in Brazil to create a new supply chain that it had hoped will generate jobs. But four years later, Foxconn’s investment in Brazil has been much smaller than the pledged amount. It is still struggling to improve the manufacturing operations at its plants for iPhones and iPads there citing its inefficient labor force. The company has also been in talks for a new plant investment in Indonesia for years.  The Indonesian government once said that Foxconn would invest up to $10 billion, but plans remain in limbo due to political snags.

2 Why India?

While China remains the world’s largest smartphone market by shipments, India has the biggest growth potential for the next 5 years, says Bernstein analyst Mark Li. India recently raised taxes on mobile phones imported to the country to 12.5% from 6%, spurring global handset makers to look at ways to manufacture devices locally.

3 Sign of shift in manufacturing to India from China?

Analysts say it is unlikely that India will overtake China to become the company’s main production base in the next few years as China has an well-established supply chain ecosystem. India still lacks good infrastructure and favorable tax and labor policies, making it a less attractive destination for tech manufacturing.

4 Foxconn Chairman Terry Gou always aims for the best deal

The agreement with the Indian government is non-binding. Foxconn Chairman Terry Gou usually gives a rosy picture about the company’s potential investments when he negotiates with government officials. But only a few investment plans materialize as he wants favorable terms including big tax incentives and free land that most governments can’t accommodate.

5 Foxconn seeks other investment opportunities in India

The company and Chinese e-commerce giant Alibaba Group Holding Ltd. are in talks to jointly invest about $500 million in Snapdeal.com, a five-year-old Indian e-commerce startup. The deal would give Foxconn a retail foothold in India where it has experienced booming demand for smartphones. Foxconn is also setting up a new production site for Chinese smartphone maker Xiaomi Corp. in India.

via 5 Things to Know about Foxconn’s Overseas Ambitions – WSJ.

18/06/2015

U.S. tech firm Cisco to invest $10 billion in China expansion | Reuters

Cisco (CSCO.O) plans to invest more than $10 billion in China along with local business partners over the next several years, the U.S. network equipment maker said on Wednesday, as it seeks to shore up its position against strong domestic rivals.

A visitor walks past a Cisco advertising panel at the Mobile World Congress in Barcelona February 27, 2014. REUTERS/Albert Gea

Cisco, the world’s biggest maker of switching equipment and routers that run the Internet, announced the investment plans following high-level meetings between top executives and Chinese Vice Premier Wang Yang and other government agency leaders.

A statement issued by the Silicon Valley company provided the broad outlines of how it planned to invest but did not detail any specific spending or timelines for doing so.

It said in a statement it had signed a Memorandum of Understanding (MoU) with China’s state planner, the National Development and Reform Commission, to expand investment.

This will be used to fund innovation, equity investment, research and development and job creation, Cisco said.

It also signed an MoU with the Association of Universities (Colleges) of Applied Science (AUAS) to advance technical training of information and communications engineers.

The company said it will invest in a four-year network engineer training program with 100 universities and colleges of applied science recommended by AUAS.

Cisco is looking to capitalize on initiatives promoted by the Chinese government including “China Manufacturing 2025”, “Internet+” and its strategy to deliver more services as cloud-based Internet services.

The move comes as pressure has grown on foreign technology firms in the world’s biggest Internet market as Beijing has moved to promote domestic technology suppliers it says are needed to protect state secrets and data.

Earlier this year, a Reuters analysis found Cisco was among U.S. technology firms which had been dropped from state procurement lists in recent years.

Cisco and arch-rival Huawei Technologies [HWT.UL] of China have been battling each other for a decade. Political controversies over ties to their respective governments have raised questions about their futures on each other’s lucrative home turf.

In 2013, John Chambers, Cisco’s long-serving chairman and chief executive, acknowledged that security controversies had stymied the company’s moves to expand in China.

Chambers took part in the recent meetings with Chinese government officials along with CEO-Designate Chuck Robbins, who is scheduled to take over as chief executive in July. Chambers will remain as executive chairman of the company.

via U.S. tech firm Cisco to invest $10 billion in China expansion | Reuters.

02/04/2015

African phone sales soar, Chinese makers have 30% of market – Business – Chinadaily.com.cn

With a growing number of Chinese cell phone makers taking giant strides in overseas markets, Africa, with its huge population, is also in its sights.

African phone sales soar, Chinese makers have 30% of market

OPPO, a Chinese producer, has unveiled two smartphones, OPPO N3 and OPPO N5, in Morocco, taking the number of Chinese cell phone makers in Africa above 10.

The first batch of manufactures entering the African market were copy makers based in Shenzhen, South China’s Guangdong province, China Business News cited Yan Zhanmeng, a senior analyst of IDC China, as saying. With a smartphone boom in 2013, more famous Chinese makers have been tapping into the market, Yan added.

IDC data showed that the market share of Chinese cell phone brands rose to 30 percent in 2014, from 15 percent two years earlier. Huawei, Tecno and Alcatel have entered the top five in the African market, which surged 108 percent last year.

Africa has a population of one billion, accounting for 15 percent of the world population. Most important is that the number of cell phone users has exceed 200 million, even during the 2009 financial crisis, the growth rate hit 14.8 percent.

Nigeria, with the biggest population in Africa, currently has the most cell phone users, accounting for 16 percent of total users on the continent, followed by Egypt and South Africa. In the next five years, the most obvious growth will focused in Central and East Africa, among which growth in Ethiopia, Congo, Eritrea and Madagascar is expected to exceed 100 percent.

via African phone sales soar, Chinese makers have 30% of market – Business – Chinadaily.com.cn.

11/03/2015

India’s Millionaires Have Been Leaving the Country in Droves – India Real Time – WSJ

India may have been minting millionaires at an unprecedented rate over the past decade, but it has also seen many of its seven-figured-citizens escape to other countries.

The latest Knight Frank’s annual Wealth Report–which looks at the spending habits of the rich, the superrich and the “I have my own Boeing but forgot where I parked it,” rich—estimates that more than 43,000 Indian millionaires left the country to settle elsewhere in the past 10 years. That is second only to China, which saw a private-plane drain of more than 76,000 people, according to estimates from property company Knight Frank and immigration consultancy Fragomen.

While Indians tended to take their railway cars full of rupees to other English-speaking countries, government restrictions have slowed the flow of Indian millionaire money in recent years, said Liam Bailey, global head of research at Knight Frank

“High net-worth Indians are a big part of the prime market in places like London and that has been slightly undermined in the last two years by the tightening of capital controls (in India) making it much more difficult to export capital,” he said.

China lost the most rich migrants as 76,200 of its millionaires left to settle in places like Hong Kong, Singapore, the U.S. and Australia. After the two billion-person emerging markets, the biggest losers in terms of millionaire migrants were France, Italy, Russia, Switzerland and Indonesia. You wouldn’t think the rich and famous would be so anxious to leave Europe but apparently high taxes on the high earners encouraged many to leave.

In terms of the countries that attracted the most millionaire migrants, the United Kingdom was the leader by a huge margin. Around 114,000 rich folks from elsewhere settled in the quaint island nation during the 10 years through 2014. It was followed by Singapore, which attracted more than 45,000 new, rich citizens, the U.S., which welcomed 42,000 elite expats and Australia, which became home to 22,000 rich newcomers. Finishing up the list of the seven most-popular countries for millionaires to escape to, were Hong Kong, Canada and United Arab Emirates.

Despite the exodus, many of the people Knight Frank has dubbed “ultra-high-net-worth individuals” remained in India.

Last year, Mumbai was home to the most, with 619 UHNWIs, who Knight Frank describes as people worth at least $30 million. Delhi was a distant second with only 157 as wealthy, followed by Bangalore with 75, Chennai with 49, Hyderabad with 39 and Ahmedabad with 20. Kolkata was not mentioned in the report.

via India’s Millionaires Have Been Leaving the Country in Droves – India Real Time – WSJ.

26/10/2014

Samsung’s China Smartphone Problems Come to India – Businessweek

And you thought iPhones were popular. At 2 p.m. on Oct. 14, Xiaomi put 100,000 of its Redmi 1S smartphones up for sale in India, using local e-commerce site Flipkart to sell them, unsubsidized, for 5,999 rupees ($98) apiece. Within four seconds the phones sold out. Such Flipkart flash sales have become weekly events since China’s Xiaomi entered India in July. “It’s the most important market for us after China,” says Hugo Barra, the Google (GOOG) alumnus now in charge of Xiaomi’s international expansion. Indians “are without a doubt the most demanding users that we have encountered.”

Xiaomi CEO Lei Jun

Consumers in India bought 44 million smartphones last year, close to 200 percent more than they did the year before. Four-year-old Xiaomi, which sells the most popular smartphones in China, has made 2014’s splashiest entrance into India’s phone market. Other companies have also sought to gain market share, especially in the peak holiday shopping season leading up to the nationwide Diwali festival on Oct. 23. Huawei (002502:CH) began selling its Honor Holly smartphone on Flipkart for $115 on Oct. 16. Motorola, which Lenovo (992:HK) has agreed to buy from Google, had 5 percent of the market in the second quarter, up from almost nothing a year ago, thanks to sales of its Moto G ($164 on Flipkart). Models from Chinese phone makers Gionee and Oppo start at $86 and $130, respectively.

via Samsung’s China Smartphone Problems Come to India – Businessweek.

20/09/2014

Huawei: The great disrupter’s new targets | The Economist

“THE last time there were so many people down by here, the Rolling Stones were in town.” So declared one of those attending an unusual gathering this week in a vast auditorium along the shores of Shanghai’s Huangpu River. The music was blaring, the coloured lights flashing and the ceiling shimmering, but this was not another rock concert. Astonishingly, the enthusiastic throngs—10,000 squeezed into the venue and another 13,000 joined in via streaming video—had gathered for a technology conference.

The gig was organised by Huawei, a Chinese maker of telecoms equipment, which used the occasion to unveil a new business strategy. As they strode across the stage in front of a video screen nearly as wide as a football pitch, Huawei’s bosses declared their aim of making their firm the world’s leading information-technology (IT) company. In the first stage of this, Huawei plans to increase its sales of servers, storage and other data-centre equipment by a factor of ten by 2020. Last year such products brought in only about $1 billion of Huawei’s total revenues of $39 billion.

It is an audacious goal. It pits Huawei against such titans as IBM, Cisco and HP—innovative giants with deep customer relationships and comprehensive offerings that Huawei cannot yet match. Then again, a decade or so ago Huawei faced a similar challenge in telecoms equipment and has grown to become one of the world’s dominant vendors. It has also become big in smartphones. Evan Zeng of Gartner, a consulting firm, says Huawei starts with an edge in China’s fast-growing market, where state-owned firms favour domestic suppliers. That said, it has some strong local rivals, notably Lenovo and ZTE.

Bryan Wang of Forrester Research, another consulting firm, says Huawei is taking on this daunting challenge because the telecoms-equipment market has become saturated and is set to grow only sluggishly. The IT business is also crowded. But it is a far bigger market than telecoms equipment, and Huawei, since it has such a small share of it, has enormous scope for growth.

In an attempt to keep the company nimble, Huawei recently introduced a system in which three of its bosses take turns, six months at a time, at being the chief executive. Guo Ping, who is in charge at the moment, argues that the telecoms operators that are now his firm’s main customers are embracing cloud computing, so it makes sense for Huawei to make sure it can provide all the gear they need to do so.

Second, Mr Guo argues, the long-predicted convergence of the telecoms and IT businesses is finally happening. The switching of telecoms and internet traffic will no longer require so much of the costly, specialist hardware that Huawei now makes. Increasingly, the job will be done by software, which will run on cheaper, standard IT equipment—what is known as “software-defined networking”. Huawei is seeking to get ahead of this disruption of its core business by being a disrupter itself.

There are good reasons to think Huawei may be up to the challenge. As a privately-held company, “its managers don’t have quarterly pressure, and can invest for the long term,” notes Mark Gibbs of SAP, a German software firm that works closely with Huawei. Ryan Ding, Huawei’s head of product development, recalls that his firm stuck with its efforts to penetrate the markets for routers and LAN switches—two important bits of telecoms gear—despite losing money on each for more than a decade. Likewise, this year it is pumping $600m, or more than half of its entire revenues from IT products, into researching future ones.

Huawei is a proven innovator entering a bloated industry, ripe for change. Its bosses speak clearly and compellingly about what innovation is for: not to win Nobel prizes, or plaudits in the media for the “coolness” of its products, but to create value for customers. To this end, Huawei stations armies of engineers at 28 “joint innovation centres” at customers’ sites around the world. “My guys don’t just ask the customer what he wants: they go to the field site together, do the installation together, and figure out together how to increase efficiencies,” boasts Mr Ding.

The American and European giants of IT have been put on notice. Mr Wang of Forrester says Huawei has already shown it can deliver a potent combination of price, service and customisation. That is why he feels sure it will disrupt the IT business just as it did with telecoms.

via Huawei: The great disrupter’s new targets | The Economist.

28/04/2014

Experts: Patent process needs update – China – Chinadaily.com.cn

Spiking demand for intellectual property services shows large room for growth

Experts: Patent process needs update

China’s patent mechanisms need to be upgraded with foreign expertise, amid a growing demand for international intellectual property services from domestic enterprises, experts said.

The number of patent applications, the demand for legal support, and intellectual property consultation in various sectors have soared in recent years, inspired by the central government’s call to develop intellectual property strategies.

But the development also poses challenges to the country’s immature patent services, they said.

The State Intellectual Property Office said China has 1,001 patent agencies and 8,861 professional practicing agents registered under the office. The entire patent agency industry generated income of more than 8.7 billion yuan ($1.4 billion), including application and managing fees, last year.

There is still room for the industry to thrive as lots of IP-related services have not yet been fully developed in China, said He Hua, the office’s deputy director.

“The skyrocketing demand in the patent application processing each year shows how big the industry is going to be, and the industry is far from realizing its potential,” He said at an IP symposium held by the All-China Patent Attorneys Association on Saturday.

China received 825,000 invention patent applications last year, a 26.3 percent increase year-on-year. The 2.38 million patent applications filed was the highest in the world for the third consecutive year, the office said earlier this month.

Chinese companies are paying more attention to international patents, with a rising awareness of their IP edge in the global market. The country received 22,924 international patent applications according to the Patent Cooperation Treaty in 2013, a 15 percent increase from 2012.

But of all the domestic and foreign patent applications filed last year, only 60 percent were processed through patent agencies, a 15 percent drop from 10 years ago.

Local agencies’ lack of knowledge of the international IP system and legal frameworks in overseas markets has forced major innovation companies to seek patents on their own.

Chinese telecommunication giant Huawei Technologies developed a 300-staff intellectual property rights department in 1995 and processed almost half the applications of its more than 30,000 international patents, said Cheng Xuxin, deputy director of Huawei’s IPR department.

via Experts: Patent process needs update – China – Chinadaily.com.cn.

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31/03/2014

China’s Huawei books quickest profit growth in four years on smartphone demand | Reuters

China’s Huawei Technologies Ltd, the world’s No.2 telecommunications equipment maker, reported its fastest profit growth in four years as expansion in enterprise and consumer revenue far exceeded growth in its network building division.

A man looks at a Huawei mobile phone as he shops at an electronic market in Shanghai January 22, 2013. REUTERS/Carlos Barria

The unlisted company has benefited from companies investing heavily in cloud and mobile computing, while it has shipped so many mobile handsets that it became the world’s third-biggest smartphone manufacturer last year.

Shenzhen-based Huawei is now looking for revenue from Chinese mobile phone operators switching to fourth-generation networks to cushion the impact of a slowdown in network spending abroad.

In 2013, net profit rose 34.4 percent to 21 billion yuan ($3.38 billion), the company said in a statement on Monday.

Operating profit was 29.1 billion yuan, compared with the company’s forecast range of 28.6 billion yuan to 29.4 billion yuan.

via China’s Huawei books quickest profit growth in four years on smartphone demand | Reuters.

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