Who will take the hegemony in the Chinese market where Huawei has dropped out? Fortune-telling trends of Chinese smartphone makers: Yasuhiro Yamane's latest situation on mobile phones in China (1/2 page)

Many people will realize that Xiaomi's presence is increasing year by year in Japan as well. Following 2020, 2021 was a year in which Chinese manufacturers made remarkable progress. In 2022, the momentum of each company will not stop, and it will show a performance that temporarily overtakes Samsung and Apple. Looking back on the movements of each company in 2021, I estimated the trends in 2022.

Realme is showing its presence on behalf of Huawei

Xiaomi's overtaking Apple in the second quarter of 2021 (April-June) smartphone shipments (counterpoint survey) was a big topic. This move seems to be momentary, as Apple has the lowest shipments in the second quarter each year, but the difference between Apple and Xiaomi, which regained second place in the third quarter, is only 1%. .. Xiaomi's current momentum is reminiscent of Huawei for a while.

Huawei, which was second only to Samsung until 2020, is no longer visible. Realme is showing its presence to replace Huawei. Realme has exceeded 100 million smartphone shipments in 37 months since its establishment in 2018. In India, which is the second largest smartphone market after China, it has overtaken Samsung and is second only to Xiaomi. The sales share of India's major e-commerce site "Flipkart" will reach the majority. Although the global shipment share has not reached 10% yet, it remains at 5% in both the second and third quarters of 2021.

realme appeared for India as a low-priced model brand of OPPO, and it was spun off due to strong sales, and it is a subsidiary company of the same group together with OPPO and OnePlus. OPPO independently develops the "OPPO A series" including low-priced models, but maintains a certain brand image by not releasing cheap models. Realme has gained a lot of support from the younger generation by releasing a super-discount model that OPPO does not release, a "pointy" model that is conscious of gaming, and a collaboration model with Japanese designer Naoto Fukasawa.

Realme will steadily increase sales in emerging markets, where it is good at. The move overlaps with the breakthrough of Xiaomi's Redmi brand a few years ago. Redmi steadily increased its popularity with its overwhelming cost performance, and introduced the gaming model "K series" etc. to match the increasing popularity. On the other hand, realme is not only a cheap model, but as mentioned above, it has already released high-end and fashion models, and the image of the product is better than Xiaomi's Redmi. Realme's momentum will probably surpass Redmi and pose a major threat to Xiaomi. Smartphones have not been released in Japan yet, but there may be a product launch in 2022.

The Chinese market is in a situation where other companies share Huawei's share

On the other hand, what kind of movement was there in the Chinese market at the knees of each manufacturer? I synthesized a graph of the number of smartphones shipped in China at the counterpoint and compared them. Depending on the survey time, Huawei is included alone, Honor independent of Huawei is included alone, and Huawei is included in "Other", so please see both bar graphs at the same time. The deviation of 1% in the figures of some shares seems to be a calculation error (rounding), so it can be ignored.

Looking at the second quarter of 2020, more than a year ago, Huawei boasted an overwhelming share of 33%. However, this number is the sum of Honor, which was still a sub-brand of Huawei at that time. It can be seen that Honor alone had a 14% share, and Huawei alone had a 33-14 = 19% share. That number wasn't much different from vivo and OPPO at 16%, at which point Huawei's share was well overtaken by its rivals.

A year later, looking at the share in the second quarter of 2021, other companies shared the share of Huawei's shipments, and Honor, which became independent from January of the same year, has lowered its share. However, with the introduction of attractive new products one after another, Honor increased shipments, and because it was originally a well-known brand in China, it will overtake Xiaomi by a small margin in the third quarter of 2021. The number of shipments is increasing. Huawei doesn't know the single number for the same period, but is it about half of the other 15%? Honor is planning to introduce a foldable smartphone in the future, and is about to become the most noticeable manufacturer in China.

China, with annual shipments exceeding 300 million units in 2020, is the world's largest smartphone market. However, there are concerns about a shortage of semiconductors and a slowdown in domestic consumption, and it is predicted that the number of shipments in the Chinese market in 2022 will fall below the previous year's level. Although vivo and OPPO have the highest market share globally, most of the shipments depend on the Chinese market, and trends in China have a great influence on the overall shipment volume. The challenge for both companies is to shift their direction to a strategy that emphasizes the global market, but it will be interesting to see how they will continue to attack overseas markets in 2022.

As mentioned above, OPPO has left the low-priced model to realme, and has been developing products specializing in the high-end and middle range. However, at the high end, Samsung and Apple have not been able to compete with each other, and the middle range model is fiercely competitive. OPPO's main model is the middle high range "Reno series" equipped with the latest camera sensor in collaboration with Sony, but now the performance of cameras from any manufacturer has greatly improved.

Therefore, by introducing the folding smartphone "Find N" and developing the original image processing chip "Mari Silicon X", we are trying to increase our presence in the industry as a technology leader. That said, Find N is currently only available in the Chinese market. Find N should expand overseas at an early stage.

Related article