Industry Observation | OPPO Chen Mingyong: The right road, not afraid of far

Wen | Mu Mao

In the past decade, China's mobile phone industry has gradually become a force that cannot be ignored in the global mobile phone market with a rich local industrial chain. Three of the world's top five mobile phone brands are from China, including OPPO, Vivo and Xiaomi. Huawei, Honor, realme, TRANSSION and other domestic mobile phone brands also have a place in the global market.

The other side of the strong domestic mobile phone industry is the aphasia of manufacturers in high-end brands and core technologies. Only Apple and Huawei, with years of deep technical precipitation, sit firmly in the two seats of China's high-end mobile phones.

The change of history, accompanied by pain, also gave birth to opportunities.

"In the past three years, the world has undergone tremendous changes, and the status of core technologies has been greatly improved." At the OPPO Future Technology Conference on December 14 this year, OPPO founder and CEO Chen Mingyong said that technology is accelerating the arrival of an intelligent society, and the key technology fields represented by perception, interconnection, converged computing and artificial intelligence will develop at a rate of more than ten times in the next decade.

This is the window period of the times, which not only requires the company to achieve a technological leap, but also emphasizes the concern and responsibility of a company to the society and the public, both of which are indispensable. In this way, you have the opportunity to get a ticket to become a top technology company.

"What awaits us will be a new era of mutual integration of all things with technological leaps, virtual and real integration, and global intelligence, and a future with more possibilities and even uncertainties." Chen Mingyong said.

Key decisions in critical times

OPPO was established for 17 years, after several changes, the early main BUSINESS DVD, MP3 and other audio-visual products, and finally chose to enter the mobile phone industry after evaluating the industry pattern and its own advantages.

What to do and what not to do, the larger the company, the higher the cost of decision-making, and the greater the cost of making a U-turn.

In this regard, Chen Mingyong has his own choice path. "People often don't understand what they want, but they're very clear about what they don't want." He said.

Chen Mingyong grew up in Wanyuan, Sichuan, and when he graduated from junior high school at the age of 15, there were two paths in front of him, one was to read teachers, become a teacher, change from a rural hukou to an urban hukou, and the other was to go to high school, but he could not go to college and return to the countryside. Chen Mingyong chose the latter because he did not want to be trapped in a small village anymore.

On the business front, the mobile phone giant at the helm still maintains the decision-making path of his youth — first of all, to rule out the inevitably wrong answers. The second is to weigh whether the risks and costs match the passions that come with the goal, and finally consider whether you have a comparative advantage.

In 2007, OPPO cut from DVD to mobile phone track. At that time, the mobile phone market was still the world of functional machines, with many brands and characteristics, but the problem was that the refinement and aesthetics were poor, and the user experience also needed to be improved. Chen Mingyong judged that this was an opportunity for OPPO. In 2008, after more than a year of polishing, OPPO released the first mobile phone with a smiley face on the back, which gradually opened up the situation. After a big wave of sand, it became one of the few companies that stayed on the table.

According to Counterpoint, by the third quarter of this year, OPPO ranked fourth in global shipments and second in China.

Today, the important period of historical transformation has once again come to OPPO. Global smartphone shipments have been declining for four consecutive years, the decline is difficult to reverse, Counterpoint data show that in the third quarter of the global smartphone shipments fell 6% year-on-year, a total of 342 million units, the Chinese market fell 9% year-on-year to 76.5 million units.

The mobile phone industry has entered the second half, and the competition at this time is not simply channel expansion or marketing tactics. High-end brand building and core technology research and development are the only way out.

An OPPO R&D executive said internally that OPPO has entered a critical period of transformation, and the more it passes, the more it has the opportunity to become a "great technology ecological company", self-repetition, there must be no way out. Whether it is technology investment, or channel change, high-end breakthroughs, brand upgrades, it is not an easy task.

In 2018, OPPO retreated and resolutely stopped entertainment marketing. At the first OPPO Future Technology Conference in 2019, Chen Mingyong announced that he will invest 50 billion yuan in the next three years to build the underlying hardware technology as well as software engineering and system architecture capabilities.

The following year, OPPO once again proposed the "3+ N + X" technology transition strategy, and built OPPO's scientific and technological capability system around hardware basic technology, software engineering technology and services.

At this year's Future Technology Conference, OPPO released the first self-developed chip Mariana X, which took three years to develop, using TSMC's 6nm process. A chip veteran said that at present, compared with the self-developed ISPs of similar domestic mobile phone manufacturers, OPPO is more willing to invest and go faster and farther in chip research and development, which is enough to show that OPPO has achieved initial results in the innovation of the underlying hardware technology.

Hill climbers

At the 2021 Future Technology Conference, OPPO put forward a new brand proposition: smile forward.

"On the right road, we are not afraid of far, we are not afraid of difficulties", this is the explanation given by Chen Mingyong. This can be seen as oppo's incentive for self-insistence on change during the transition period, and it is also the only way to become a high-end brand that is generally recognized by society.

Insisting on self-developed chips is destined to be a bumpy road. In the past, there was no shortage of huge investment but failed projects in the industry, and non-commercial factors such as international relations friction also cast a shadow on the chip industry, but this is still a position that mobile phone manufacturers have to conquer.

A technology company, without the underlying core technology, there can be no future. High-end products without the underlying core technology are even more castles in the air. Chen Mingyong said that Mariana X is a small step for OPPO, and will continue to invest resources in the future, with a team of thousands of people, to engage in self-developed chips in a down-to-earth manner.

Liu Jun, senior vice president of OPPO, lamented in an internal sharing that in the past, there were always leaders in the industry defining the future, and now, OPPO has also entered a no-man's land full of uncertainty and is exploring the road where there is no perfect solution. "The only thing that can be determined is that in the no-man's land competition, if the competitors drive the aircraft carrier battle group over, and we are still studying how to burn Chibi, we must not win."

At this year's conference, in addition to the Mariana X, OPPO also showed its first folding screen phone, Find N, as well as the third generation of OPPO Air Glass smart glasses.

The two intelligent hardware products are the staged achievements of OPPO's exploration of future cutting-edge technology. OPPO Find N has upgraded the form and use experience of existing folding screen mobile phones after 4 years and 6 generations of iterations, and reduced the price of folding screen mobile phones to less than 8,000 yuan, which is equivalent to the top price of a high-end flagship bar machine. Oppo Air Glass, a smart glasses, has launched a more mature AR solution on the basis of the previous generation of products.

To this day, Chen Mingyong still has his own judgment on the direction and rhythm of what products to do. Just like the past abandonment of electronic pets, dancing carpets, the life cycle of these products is too short, just a flash in the pan, he believes that to choose a long enough track, to be able to meet the needs of human nature. Similarly, we must pay attention to the risks of the concept, do not deviate from the main channel to make quick money, let the team have a speculative mentality, and do things that need to be adhered to for a long time.

It is understood that OPPO's future investment has three major priorities: one is based on self-developed chips to create a vertically integrated system solution for soft and hard cores; the other is to build a cross-end operating system based on multi-device carriers based on user usage scenarios; the third is to obtain massive machine learning data based on sensors, and empower the ability of software and hardware through the guidance of algorithms.

"The technical areas we are focusing on now, whether it is interconnection, AI algorithms, or intelligent assistants, big data, etc., are all key problems that we hope to solve users through key technologies." Liu Jun said that he is thinking about how to reduce people's learning costs or improve work efficiency through technology, or make lifestyles healthier, or make people's relationships more harmonious. This is OPPO's pursuit of technology.

OPPO also proposed to "consolidate the foundation of research and development and create an engineer's paradise". A year has passed, and the results have begun to appear. At present, OPPO has established cooperation with more than 40 international universities, more than 150 experts and scholars, and more than 40 consultants in the field of production, education and research, added more than 120 cooperation projects, and readjusted the R&D structure, formed an organizational structure of "engineering + research + foundation", and built a technical moat.

OPPO is completing a series of transformations, from a mobile phone brand to a technology brand, from a mid-range brand to a mid-to-high-end brand. Once again, this 17-year-old company that has gone through the historical cycle is standing in front of the door of change, and when it passes, it has the opportunity to become a truly "great" technology company.

"We always believe that if we insist on doing the right thing and taking the right path, we will not be afraid of the distance, let alone the difficulty." Chen Mingyong said.