Smartphone sales see modest rebound after two-year slump

China is expected to be a front-runner in the adoption of 5G services with more than 170 million subscribers by next year, according to China Telecom. (Reuters)
Updated 02 November 2019

Smartphone sales see modest rebound after two-year slump

  • Samsung remains leading vendor while Huawei confirms No. 2 spot with gains in home market, survey shows

WASHINGTON: Global smartphone sales increased modestly in the third quarter, the first growth for the segment after a two-year slump, a market tracker said.

Data from Strategy Analytics late on Wednesday showed handset shipments up 2 percent from a year earlier at 366 million units, the first rise since the third quarter of 2017.

South Korean-based Samsung remained the top vendor and China’s Huawei held its number two spot despite US sanctions, ahead of third-place Apple, the research group said.

“Worldwide demand for smartphones is recovering, due to strong pricing competition among vendors and innovations such as larger screens and 5G connectivity,” said Linda Sui, an analyst with the group.

Samsung extended its lead in the market by boosting sales by 8 percent in the quarter to 78 million units, representing a 21.3 percent share.

Huawei was the biggest surprise, showing a gain of 29 percent with 66 million units sold, giving it an 18.2 percent market share despite sanctions imposed by Washington that could make it harder to obtain key technology and components.

The Chinese firm, which launched its latest high-end smartphone in September without popular Google apps, picked up gains in its home market, according to Strategy Analytics, which said Huawei’s gains were largely in its home market.

The report said Apple’s sales of iPhones fell 3 percent from a year ago to 45.6 million units, giving it 12.4 percent of the market.

Apple, which released its quarterly update Wednesday, did not disclose iPhone unit sales but said revenue from its iPhones was down 9 percent.

“Despite the slight decline, this was actually Apple’s best growth performance since last year,” said analyst Woody Oh. “We believe Apple is stabilizing, due to cheaper iPhone 11 pricing and healthier demand across Asia and the US.”

The report showed China-based Xiaomi maintaining fourth place with a 9 percent market share, followed by another Chinese firm Oppo, at 8 percent.

Other unspecified vendors captured the remaining 31 percent of the market, the report said.

China’s three major state telecom operators rolled out 5G wireless technology on Thursday, as the country races to narrow its technology gap with the US.

China Mobile, the country’s largest carrier, announced its 5G services were available in 50 cities — including Beijing, Shanghai and Shenzhen — with packages starting from 128 yuan ($18) a month.

Rivals China Telecom and China Unicom are also offering services at comparable prices in major cities, according to notices on their websites.

The ultra-fast mobile Internet service, which is 100 times faster than existing 4G networks, allows consumers to download full-length films within seconds, or use apps with virtual reality.

The technology will also pave the way for driverless cars, further automation in factories, and allow users to remotely control appliances such as coffee makers and ovens via the Internet.

China is expected to be a front-runner in the adoption of 5G services with more than 170 million 5G subscribers by next year, according to estimates by China Telecom.

South Korea will be in second place with a predicted 75,000 users, followed by the US with 10,000, analysts at Sanford C. Bernstein said in a recent research note.

“China will promote the deep integration of new generation information technology and the real economy,” said Chen Zhaoxiong, vice minister of the Ministry of Industry and Information Technology at a technology conference on Thursday.

“This involves accelerating the integration and application of 5G in industries, transportation, energy, agriculture, education and health,” Chen said, according to a statement on the ministry’s website.

Beijing has been pushing for a quick rollout of the technology, and China’s state economic planner said in January that developing a 5G network was one of its “investment priorities”
this year.

Despite the success of 5G networks at home, Chinese telecom equipment giants have faced regulatory push back abroad.


World Bank chief tells China it needs ‘vital’ reforms

Updated 59 min 13 sec ago

World Bank chief tells China it needs ‘vital’ reforms

BEIJING: World Bank chief David Malpass urged China on Thursday to further open up its economy and reduce state subsidies, echoing key demands made by the United States in protracted trade war negotiations.

Malpass made the remarks after a roundtable meeting with Chinese Premier Li Keqiang and the heads of other global institutions, including the International Monetary Fund and the World Trade Organization.

“I encouraged new reforms and liberalization,” he said.

Beijing is struggling to kickstart the economy, which expanded at its slowest pace for nearly three decades in the third quarter amid cooling global demand for its exports and a looming debt crisis at home.

Malpass said Beijing must resolve bilateral trade disputes and improve transparency in lending to avoid a sharp downturn on growth over the coming decades.

“China could improve the rule of law, allow the market to play a more decisive role in allocating resources including debt and investment, reduce subsidies for state-owned enterprises... and remove barriers to competition,” he said.

“It is hard to achieve but it is vital for reducing any inequality and building higher living standard,” Malpass said.

State-owned behemoths dominate lucrative sectors of China’s economy — including energy, aviation and telecommunications — where access to private players is restricted.

China’s trade partners have also long complained about the lack of an equal playing field and theft of intellectual property.

The country’s rubber-stamp parliament in March passed a foreign investment law that promises to address these issues, but local governments are still working on detailed rules needed to implement it.

Li said both domestic and foreign companies registered in China will be treated equally.

“They will have equal access to investment opportunities, equitable access to resources, legal protection in accordance with the law,” he said.

Beijing has also announced a timetable to open up its financial sector to foreign investors next year, as it attempts to woo outside capital to shore up an economy battered by the trade war with the United States.

China and the US have slapped tariffs on over $360 billion worth of goods in two-way trade.

Negotiators from both sides have been working toward a partial deal, but US President Donald Trump on Wednesday said Beijing has not made sufficient concessions, making him reluctant to conclude a bargain.

Economic data shows the uncertainty created by the trade spat between the world’s two biggest economies is undermining global growth.

IMF chief Kristalina Georgieva warned that implementing all the announced tariffs would cut $700 billion out of the world economy next year.

“What should be our priorities? First, to move from trade truce to trade peace,” she said.