After years of development, seventy percent of the world's mobile phones are now made in China, but in the most lucrative high-end market, domestic manufacturers have been single for a long time, and the once high-end "Huawei" has become a "swan song" because of the ban.
After Huawei "lost its voice" to the high-end, other domestic manufacturers actively or passively participated in the high-end market competition, which looked very lively, but in fact, the high-end went not smoothly. However, this is not surprising, because the high-end market has more demanding requirements for products.
(Pictured from Canva)
High-end machines need "real kung fu"
After ten years, the shipment volume of China's smartphone market fell again to less than 300 million units, only 286 million units, a year-on-year decline of 13.2%, and the sharp decline in sales indicates that China's smartphone market has officially transformed from "incremental" to "stock" market. It is worth noting that in the process of the market crash, the high-end market seems to be little affected, still maintaining positive growth, becoming a "rare" structural opportunity in the smartphone market.
However, just as there are always two sides to the coin, in order to really do a good job in a high-end machine and achieve the ultimate user experience, it is not only a "single point breakthrough" in the past when it is low-end, but requires manufacturers to have the ability of "decathlon", which is the "fundamental" to support high-end mobile phones to gain a foothold in the market.
On the one hand, high-end users have more "extreme" requirements for the coordinated use of software and hardware, they are not so sensitive to price, but they must be genuine, but it is difficult to impress them with simple "stacking" without differentiated core technology.
In the past, foreign brand VERTU was sprayed flashy, relying on the gimmick Web 3 smartphone "pile up speculation" Web 3 concept, and was complained of "cutting leeks"; Later, there are domestic Android manufacturers, because of the similar supply chain and falling into the "crazy stacking" competition, all prove this. For example, in order to impact the high-end, the 2K screen, IP68-level waterproof, high refresh screen and other hard-core configurations that were missing hardware in the past are now becoming popular, and now the basic functions of each flagship machine have become standard.
Zooming in a little, from Qualcomm Snapdragon, MediaTek chips to Samsung screens, basically every smartphone manufacturer will access the ecological enterprises in the industry chain, which makes the difference between them almost stay on the basis of using the technology of the previous generation or the next generation of chips of Snapdragon, and it is difficult to achieve real differentiation, so "stacking" competition is inevitable. Speaking of which, it is not that other manufacturers do not work hard, it is really a good job in software, especially software and hardware coordination, itself is a big threshold, its "root" technology often points to the underlying architecture technology including chip design, but other manufacturers are often difficult to meet the corresponding technical standards at this point.
Take Xiaomi's MIUI 12 as an example, it has achieved industry leadership in system animation and system-level security control through deep customization of the Android system, but Xiaomi has advantages outside the system that other manufacturers have. From the perspective of the industry, mobile phone manufacturers that can achieve chip-level customization upgrades and deep optimization iterations, only Huawei Kirin chips can do it, and the customization ability of "root" technology is the core premise and fundamental guarantee that Huawei's high-end machines can stand side by side with Apple's A series high-end machines. So far, "Rongmi OV" still needs to be sublimated on this road.
On the other hand, high-end users will have relatively high requirements for the mobile phone itself, and they will not only have requirements for the practical functions of the mobile phone, but also for the "appearance" of the mobile phone.
In the eyes of many consumers, the smart phone is another part of the "body", and everyone hopes to have a pleasing mobile phone in the case of "the machine does not leave the body", which involves the design of industrial aesthetics. In terms of appearance, domestic mobile phone manufacturers are still remarkable. For example, the Honor Magic 4 has a muse-eye camera design, OPPO's integrated streaming cloud dual mirror design, Huawei's Vientiane double ring design, etc., all have a high degree of recognition, as well as the streamlined design of the back, metal frame and glass body and other exterior shapes have also been improved. Therefore, in terms of industrial design level, domestic mobile phone manufacturers are not only inferior to international "friends", but also out of their own differentiation.
Of course, only to achieve the core technology, industrial aesthetics is far from enough, from the high-end road of Huawei, Apple, these are only the basics, to impact the high-end also need to form an undifferentiated high level in brand building, quality assurance, feel and other aspects, to put it bluntly, the high-end must be a boutique without any shortcomings, which is also the reason why Huawei Mate and P can dominate the high-end, but also the reason why other manufacturers can not completely "swallow" the blank market left by Huawei.
Shortcomings: There are more and more internal and external challenges
From the current point of view, after "Huawei" withdrew from the high-end market, the existing domestic smart phone manufacturers have various shortcomings, and some of these shortcomings can be made up for in the short term, and some will take some time to digest.
First, various manufacturers still have shortcomings in the chip design capabilities representing the underlying "root" technology. Judging from the public information, the manufacturers who have officially announced the success of self-developed chips have expanded from Huawei to OV Xiaomi, and compared to the other three, the only uncertain thing is the ominous glory.
Among them, Xiaomi has launched The Paper S1, The Paper C1, The Paper P1 and The Paper G1, these self-developed chips cover mobile phone processor chips, camera chips, battery fast charging chips and other chip technologies involving the core functions of smart phones, representing the latest level of Xiaomi's self-developed chips; Vivo's high-end models have gradually appeared from V1 to V2 processor replacement, and OPPO's self-developed mobile phone chip has also been successfully tape-out and is expected to be listed in the third quarter of this year or next year. Judging from these news, domestic mobile phone manufacturers have made great progress in chip design, and the content of self-developed technology has been significantly improved.
However, from the perspective of the research and development level of the entire domestic Android manufacturer camp, this technological progress is still limited to the special field, and the domestic substitution from dedicated to general is still a long way off. Specifically, mobile phone communication chips involve CPU/GPU, ISP and DSP, baseband chips, memory chips and other components (NPU) and many other fields, and the current self-developed SoC process technology that represents the highest threshold, only Qualcomm, MediaTek, HiSilicon, Samsung and Apple and other companies have this capability, and the rest of the domestic manufacturers still need to pay authorization fees to obtain licenses, still do not have this self-developed ability.
For example, Xiaomi's surging S1 has become a "single Netcom" because of the lack of communication patent technology, because the core technology is still in the hands of giants such as Qualcomm; The surging S2 failed to tape out (trial production) many times, costing hundreds of millions of yuan before and after without results, while explaining the complexity of chip design, it also shows from the side that domestic manufacturers still have insufficient technical experience, and other manufacturers are similar. From this point of view, the "gap" caused by the suspension of production of Huawei HiSilicon due to the "production of card neck" is still not made up by other domestic mobile phone manufacturers in the short term.
Second, from the perspective of OV Miron's own situation, the shortcomings are also different. According to the 2022 global smartphone market share ranking data released by Canalys, among the top five mobile phone manufacturers in the world last year, Samsung (22%), Apple (19%), Xiaomi (13%), OPPO/vivo were all 9%, and the others were listed as others. It is worth noting that the overall market share of Samsung and Apple has increased by 2%, while both Xiaomi and OPPO and vivo have decreased their share by 1-2 points, which shows that Samsung and Apple have seized the share of some domestic mobile phone manufacturers.
Looking at the manufacturers, although vivo is often in the first and second position in the domestic market, it is difficult to open the situation in the overseas market; On the contrary, Xiaomi fell all the way to the fifth position in the domestic market last year, but achieved substantial growth in overseas markets, so it maintained the third position; The situation of Glory is similar to vivo, the overall sales situation presents a situation of "strong at home and weak overseas", and the problem of "inventory accumulation" in terms of channels is also worth paying attention to; Although OPPO's domestic market has declined, it has maintained growth in overseas markets, so it has barely maintained its top five position.
Objectively speaking, it is quite difficult for domestic mobile phone manufacturers to enter the current stage. After Honor left Huawei, it once fell to the bottom (share was only 3%), and then re-entered the top positions; OPPO and Xiaomi have also been fighting overseas for many years, which is today's results. But in today's fierce competition in the industry, the more shortcomings mean the more flaws, the greater the challenges, and there is no other way to do it except for manufacturers to practice hard work.
Going to sea: The blue ocean is turning into the red sea
In the past few years, the words blue ocean naturally came to mind whenever smartphones went overseas, but now the so-called "blue ocean market" overseas is becoming a "red ocean".
First, for the relatively picky European market, which is also high added value, domestic mobile phone brands have not yet come up with similar products comparable to Huawei Mate and P, and are still on the defensive in overseas markets. From the general direction of going overseas, the basic disk of high-end mobile phones is still the European and American markets, and the current situation is mainly the European market, and it is difficult for other regions to have strong consumption power. However, the European market is the world's more selective market for applications, although the EU is vast, but the regional languages, customs are still quite different, application habits are also different, which leads to the development of high-end smartphones in the European market takes time to accumulate.
From the past situation of the European market, the only high-end brands that have really occupied the European market are Samsung, Apple and Huawei. According to Huawei's financial report for the first quarter of 2019, its mobile phone sales in the first quarter of 2019 once reached 13.5 million units, most of which were relatively high-end Mate and P series, which made it catch up with Apple and sit on the world's second throne. But after Huawei "lost its voice" high-end, there is currently no such a powerful high-end model that can "fill" the gap left by Huawei.
According to the data of the "Global Smartphone Brand and User Research Report" released by Feishu Shennuo Meet Intelligence in 2022, in the minds of overseas consumers, Apple, Samsung have the highest brand definition, usually giving people the impression of "professional", "good quality" and "respect for customer privacy", of which Apple's positioning is particularly deeply rooted in the hearts of the people, in addition to "humanization" is also its largest brand identity to consumers in overseas markets. In contrast, Chinese high-end brands are known for their "cost-effective", "innovative" and "trend-leading", etc., and are not the "reliability and trust" that consumers are most concerned about, which makes it difficult for new high-end brands to occupy the minds of users, resulting in a disadvantage in overseas expansion and difficult to effectively exert their potential.
Second, the overseas smartphone market is also not optimistic, which will undoubtedly increase the difficulty of high-end brands going overseas. According to statistics released by market research agency Counterpoint Research, the European smartphone market shipped 176 million units in 2022, down 17% year-on-year and the lowest level since 2012. Counterpoint said that Apple's iPhone 14 series models were launched in the European market and also had the weakest sales in a decade.
According to institutional analysis, this is mainly due to the economic recession in major countries in the European market, weakening consumer demand, and high inventory of smart machine manufacturers. It can be seen that today's high-end smartphone brands go overseas, which is different from the previous blue ocean era.
Turnaround: What else is there besides folding screens?
It is worth noting that in the middle of the overall market, folding screens, as a segmented advantage growth category, have gradually gained more attention from the outside world, and have increasingly become a "must-fight place" for high-end smartphone brands. In addition, the opportunities derived from segmented needs such as photography and videography have also received the attention of many brands.
On the one hand, it is due to the "outstanding" performance of the folding screen category in the overall downward market. Strategy Analytics data shows that in the third quarter of 2022, global shipments of folding screen smartphones climbed sharply, hitting a record high again. At the same time, China's folding screen mobile phone products shipped more than 1 million units in a single quarter, a year-on-year increase of 246%, far exceeding the growth rate of the broader market and setting the largest single-quarter shipment in history.
The positive data has boosted some confidence in the sluggish mobile phone market. Relevant data shows that as of 2022, 7 mobile phone manufacturers and more than 20 folding screen mobile phones have entered the market. Among them, Huawei, as an early entrant into folding screen mobile phones, is the main research and development force in this field. Taking the Mate Xs 2 as an example, its improvement in weight, thickness, crease, fall resistance and other aspects is mainly due to the breakthrough of a number of key research and development technologies; Followed by Honor, vivo, OPPO, etc., also have their own masterpieces, from the latest data, Honor folding screen quarterly performance is excellent, share in the forefront.
On the other hand, it lies in the maturity of domestic folding screen technology, so that domestic manufacturers have comparative advantages. As the "rising star" of smart phones, domestic mobile phone manufacturers have been sparing no effort in technological innovation, and this "enthusiasm" for technology allows domestic manufacturers to continue to innovate in the field of folding screens, and the accumulation of technology is becoming thicker and thicker. Take the key technology of folding screen - hinge technology, from the earliest "U-shaped" to the later "drop-type" hinge technology, domestic manufacturers continue to overcome difficulties in "eliminating creases" and "thinning and slimming", making the experience and appearance of folding screen mobile phones themselves more appreciative.
In terms of comparison with foreign manufacturers, Chinese mobile phone brands are also among the best. In the data list of CINNO Research, Huawei occupies the head position of the folding screen, followed by Samsung, only half of Huawei's share, the remaining three are OPPO, vivo, honor three occupy, and Apple is still waiting and waiting to participate. In general, domestic manufacturers have a comparative advantage in this field.
In addition to folding screens, with the continuous improvement of people's demand for intelligent machine imaging capabilities, various smart manufacturers are also making articles around high-end image brands. For example, Huawei has gathered the culmination of many years of imaging technology capabilities, launched a new imaging technology brand XMAGE last year, Xiaomi Lei Jun is also vigorously researching imaging technology, and the Xiaomi 13 jointly launched with Leica also has the tendency of imaging technology, and the latest Honor new machine has also brought progress in its imaging technology. It can be seen that in this subdivision track, it is also the focus of the next competition for high-end machine brands.