【Text/Observer Network Lv Dong】
"Apple is not invincible", "to change the situation of Apple in the high-end market", "must let consumers feel that there is an experience beyond Apple", "high-end flagship fully benchmarked Apple", in the past year or so, not only The chairman of Xiaomi Group, Lei Jun, but also the glory CEO Zhao Ming, who has left the Huawei system, has publicly shouted similar slogans.
However, on April 28, the data provided exclusively to the Observer Network by market research agency CINNO Research showed that in the first quarter of 2022, the share of Apple's iPhone in the domestic high-end mobile phone market of more than 5,000 yuan increased to 79% compared with the previous quarter, and the data in 2020 was 48%; the share of Huawei's high-end machine shrank to 14%; OPPO's third was only 1.7%, and the rest was counted as "others".
This set of data shows that huawei's domestic high-end mobile phone market share is completely pocketed by Apple. Although domestic manufacturers continue to cheer themselves up, they still seem to be in the stage of shouting slogans to challenge Apple in the high-end market.
The most important impact on the high-end is undoubtedly the core competitiveness in the field of software and hardware. The japanese media's recent dismantling of honor mobile phones shows that the proportion of US parts has increased by nearly 30 percentage points compared with before leaving Huawei. After leaving Huawei, Honor, like other domestic friends, "Android system, Qualcomm chip" has become the new standard. The lack of differentiation undoubtedly increases the difficulty of Honor breaking through Apple's moat (self-developed chip and iOS ecosystem).
If you put aside the high-end market, Honor's recent performance is still remarkable. CINNO Research data shows that in the first quarter of 2022, the sales of Honor mobile phones have risen to the second place in the domestic market, and the sales of OPPO, vivo and millet have all declined by 20%-40% year-on-year, and the sales of Apple mobile phones have also fallen slightly by 1.3% year-on-year.
As for impacting the high-end and challenging Apple, domestic manufacturers should be as Zhao Ming mentioned earlier this month, benchmarking Apple can not only rely on simple slogans, to have enough patience, the rise of high-end mobile phones is by no means overnight, we must adhere to the underlying innovation and core capabilities of continuous construction.
Apple CEO Tim Cook
The proportion of parts in the United States has increased significantly
By dismantling the Huawei Mate30 and Mate40E, the proportion of Chinese and American parts used by Huawei mobile phones after sanctions is observed; the DJI drone is dismantled to analyze its cost structure and technical competitiveness; and the Wuling Hongguang MINI EV is dismantled to study the reasons why its cost is lower than that of tesla Model 3. In the past two years, Nikkei Shimbun has been trying to analyze the progress of China's technology industry by disassembling related products, and this time the Japanese media has turned its attention to the glory mobile phone.
A few days ago, with the assistance of a third-party investigation company, Nikkei News dismantled the Honor X30 5G mobile phone listed in December 2021, and this smartphone with a starting price of 1499 yuan was positioned in the middle and low end. Nikkei estimates the cost of various parts and components, and counts the proportion of parts from various countries and regions.
Source: Nikkei Asia Review
Through disassembly, it was found that the total cost of Honor X30 parts was about 217 US dollars (about 1422 yuan).
Among them, the cost of US parts accounted for up to 39%, compared with the Honor 30S 5G mobile phone listed in the Spring Festival of 2020 before the divestiture of Huawei, the proportion of US parts increased by 29 percentage points.
Among the core components, the main processor, 5G communication semiconductors, power supply semiconductors, products from HiSilicon have been replaced by Qualcomm in the United States, and the suppliers of analog semiconductors have changed from HiSilicon and Japan's Murata to Qualcomm and Qorvo in the United States.
Disassembly shows that HiSilicon Semiconductor disappeared in the main components of the Honor X30 model.
Source: Nikkei Asia Review
Affected by this, the proportion of Chinese parts in the Honor X30 fell to 10%, down 27 percentage points compared with before leaving Huawei.
In terms of the main components with higher costs, Chinese companies supply only liquid crystal displays, which cost about 14 US dollars (about 92 yuan), only 20% of OLED screens, and suppliers include BOE and Tianma Micro; other Chinese components used are signal amplifiers for the previous generation of communication standards.
Source: Nikkei Asia Review
Japanese companies are the second largest source of supply outside the United States. According to the disassembly information, the Sony Group's camera image sensors, Murata Manufacturing, Sun-Induced Electric, TDK and other communication components have expanded their share of supply. With the enhancement of ultra-high-definition cameras and communication functions, the adoption of Japanese parts has increased. In addition, due to the supplier of the Honor X30 memory chip from Samsung to Micron, the proportion of Korean parts has decreased.
Chinese mobile phone manufacturers that rely heavily on American parts are not only honored. Japan's Fomalhaut survey shows that in Xiaomi's folding screen mobile phone MIX FOLD listed in 2021, the proportion of American parts is 26%; in the OPPO Reno6 Pro+ model, which focuses on the high-end market, the proportion of American parts accounts for 31%. In each series of domestic mobile phones, the main processor uses almost all Qualcomm or Taiwan MediaTek products.
Source: Nikkei Chinese Network
The dilemma of hardware dependence seems to be difficult to avoid in software. Japanese media alleged that the Honor X30 still uses the Android system of Google in the United States, and Android accounts for 70% of the global share in the mobile operating system, and it is not an easy task for Chinese mobile phone manufacturers to get rid of the influence of the United States.
Affected by U.S. sanctions, Huawei has been promoting the autonomy of software and hardware before. In terms of software, Huawei developed the Hongmeng operating system that can be used for mobile phones, and donated all the basic capabilities of Hongmeng to the China Open Atomic Open Source Foundation in two installments, which means that Hongmeng has been transformed from Huawei-led to industrial co-construction. However, at present, mainstream mobile phone manufacturers including Honor, Xiaomi, OPPO, vivo and other mainstream mobile phone manufacturers have not yet released models based on the Hongmeng operating system.
In June 2021, when asked whether the Hongmeng operating system will be adopted, Zhao Ming, CEO of Honor, responded at a press conference that the current Glory products are still based on Android, and will pay attention to the future development of the Hongmeng ecology, and will choose the operating system according to the preferences of global consumers in the future.
Apple is still "one big" in the high-end market
Self-developed key chips, operating systems, is two major breakthroughs in the high-end mobile phone market, in addition to Huawei and Apple, the domestic mobile phone market has not yet been players can do.
After Huawei lost its high-end chips, Apple, with its A-series chips and iOS ecosystem, presented a "one-size-fits-all" trend in the high-end market.
However, domestic mobile phone manufacturers that "use Google for the system and Qualcomm for chips" still have the confidence to challenge Apple.
Following Lei Jun's proposal that Xiaomi mobile phones should be "fully benchmarked against Apple", Honor CEO Zhao Ming also proposed to compete with Apple.
Lei Jun at the Xiaomi Mi 12 press conference
At last month's Magic4 series mobile phone conference, Zhao Ming bluntly said that Magic4 is a product that can be compared with the iPhone, "Glory wants to change the situation that Apple is dominant in the high-end market, and we must let consumers feel that there is an experience beyond Apple." ”
But what are the advantages of Glory compared to Apple?
Zhao Ming pointed out that the pricing of the iPhone13 is a dimensionality reduction blow, and the starting price of the Magic4 series of 3999 yuan is also competitive. In the Chinese market, Honor's understanding of China's Internet ecology and services is far better than Apple's. In addition, Honor's annual R&D investment accounts for about 7%, which will be more bold in innovation, and the use and introduction of new technologies will be faster than others.
Since last year, he has also mentioned many times that "Glory will benchmark Apple in consumer experience in multiple dimensions such as privacy and security, communications", "No brand cannot be shaken, in the face of Apple's success, Glory's strategy is to launch integrated computing photography, and directly compete with Apple in the photo experience." ”
In early April, Zhao Ming revealed that more than 60% of the buyers of the Magic4 Standard Edition that had been sold were from Apple and Huawei.
In November 2013, Honor, as a sub-brand of Huawei, was born, a mobile phone brand positioned in the Internet sales channel, facing young people, adhering to the low-end price point, and basing itself on the market with high cost performance. In November 2020, Honor, which was spun off from Huawei, established a new positioning: the mid-to-high-end market.
In order to impact the high-end, Honor has also changed the pace of product releases. Before independence, honor flagships followed a rhythm of annual updates. After independence, the update speed of high-end flagships such as Honor's digital series and Magic series has been adjusted to a semi-annual update.
In the past year and a half, Honor has released V40 series, 50 series, Magic3 series, 60 series, X20 series, X30 series, Play 5 series, the first folding screen MagicV series, Magic4 series and many other products.
Honor CEO Zhao Ming released the Magic4 series of smartphones
But from the perspective of the pattern of the high-end market, Apple still seems to be riding the dust.
Exclusive data provided by market research agency CINNO Research to the Observer Network shows that in the first quarter of 2022, Apple dominated the high-end market of more than 5,000 yuan driven by the strong performance of the new iPhone 13 series, and its share further increased from 75% in the fourth quarter of 2021 to 79%, while the figure in 2020 was 48%.
Among domestic manufacturers, Huawei's high-end market share shrank to 14% (in the first half of 2020, IDC statistics, Huawei ranked first in China with a share of 44.1%); none of the remaining manufacturers exceeded 2%, OPPO's share was 1.7%, Xiaomi and Honor were both 1.4%, and Vivo's share was 0.4%.
The disparities are clear.
At the offline sales end, recently there have been mobile phone channels to the media bluntly, the glory of the brand pull is still not enough, the most popular model is still the number of models, concentrated in the price range of 2000 yuan - 3000 yuan.
For Glory, there is still a clear way to go from standing at the high end. Zhao Ming also admitted in early April that the rise of high-end mobile phones is by no means achieved overnight, and we must insist on continuous construction of underlying innovation and core capabilities.
When it comes to core capabilities, Apple is undeniably a role model for domestic mobile phone manufacturers.
Tian Ting, senior analyst of CINNO Research, pointed out to the observer network that Apple has a self-developed chip and a unique iOS system that is ahead of other brands, which greatly enhances the sense of user experience, although domestic brands are good enough in hardware configurations such as screens, charging, photography, batteries, etc., but there is still a big gap in the comparison with Apple in core technologies such as chips and operating systems.
In Zhao Ming's view, self-developed ordinary chips are not a problem for Glory, and the real difficulty is the SoC chip, because it contains CPU, GPU, Modem, etc., which requires the underlying communication algorithms and capabilities. He mentioned at the Magic4 press conference that Honor will cooperate with SoC suppliers such as Qualcomm and MediaTek for a long time to combine Honor's capabilities with the capabilities of chip manufacturers to jointly define chips.
"High-end mobile phone breakthroughs require leading technological innovation, constantly solving the pain points of consumers using mobile phones, we must be the terminators of pain points, and the accumulation of hardware configurations cannot solve the problem." Zhao Ming mentioned last month.
Although the high-end market still needs to work hard, the overall market performance of Honor has improved significantly compared with last year.
According to CINNO Research data, in the first quarter of 2022, the overall sales of Honor mobile phones increased by 176.0% year-on-year, occupying the second place in the domestic market, and 3 models of the company entered the top ten of the single product sales list in the first quarter. Although OPPO still maintains the first quarterly sales ranking, the gap with the rapidly rising glory sales is already very small. From the perspective of March alone, Honor has surpassed OPPO and ranked first in the domestic mobile phone market sales.
Domestic smartphone shipments in the first quarter of 2022 Data source: CINNO Research
If you look at the mobile phone market as a whole, the start of 2022 can be said to be quite difficult.
In the first quarter, Chinese mainland smartphone sales were about 74.39 million units, down 14.4% from the same period last year. From the perspective of March alone, the sales of smartphones in the Chinese mainland market were about 20.04 million units, a year-on-year decline of 24.7%, compared with the month-on-month decline of 14.6% in February, and the situation of double contraction continued again; the sales of the top five mobile phone manufacturers all fell by double digits month-on-month.
Domestic smartphone shipments in March 2022 Data source: CINNO Research
CINNO Research analysts pointed out to the observer network analysis that in the mobile phone form tends to be similar, the chip performance improvement is limited, there is no revolutionary change in the image function, and the consumer replacement cycle continues to lengthen. At the same time, under the influence of macro factors such as the epidemic, the heat of the domestic mobile phone consumer market in the first quarter of 2022 continued to decline.
He also mentioned that since March, the epidemic in Shanghai, Shenzhen, Suzhou and other places has seriously hit the rhythm of production and transportation of the consumer electronics industry chain, and as the epidemic in Shanghai intensifies in April, the semiconductor supply chain in the Yangtze River Delta region is seriously insufficient and the logistics are generally delayed, and the decline of smart phones will continue.