Smartphone Market Faces Bloodbath

Smartphone Market Faces Bloodbath
The smartphone market is so competitive that only three or four vendors can survive in it, Huawei predicts.

(CCM) — The cost of smartphone development will lay waste to the market, leaving just three or four companies standing, Richard Yu, consumer chief of Huawei Technologies, predicted at the Mobile World Congress (MWC) in Barcelona.

"If your market share is less than 10 percent you cannot be profitable. Over at 10 percent, at least, you can break even (and) over 15 percent you can make money," he said in a Reuters report.

Huawei is the world's third largest smartphone maker behind Samsung and Apple, but only commands a market share of 10.2%, according to figures compiled by IDC and Strategy Analytics.

The remainder of the market is accounted for by a large number of much smaller players such as OPPO and Xiaomi, and Yu predicted that most of these, including many Chinese vendors, would disappear.

He added that smaller vendors do not have sufficient resources to invest in research and development and the branding and marketing needed to survive in a competitive global smartphone market.

The company has decided not to use MWC as a platform to launch its new flagship P20 smartphone. Instead it plans to unveil it at a standalone event in Paris in March. The smartphone will include some "big and bold" innovations in camera technology, Yu promised.

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