back to article Huawei? Apple and Samsung's worst nightmare, pal

Huawei claims to have banked over $11bn in smartphone revenue in 2014 despite falling short of its volume prediction. Consumer chief Richard Yu says the Chinese giant shifted 75 million units in the year, a little short of the 80 million it had predicted - but still up 40 per cent from 2013, the WSJ reports. Three of the top …

  1. DerekCurrie
    Megaphone

    Whose worst nightmare? Samsung's! Not Apple's.

    When the Chinese in general come out of their communist creativity coma, maybe they'll actually invent and innovate. Until then, it's the cheap knockoff wannabe companies that will be competing in the low end of the market with Chinese companies. That means Samsung, as opposed to actually inventive and innovative Apple. :-D

    1. DiViDeD Silver badge

      Re: Whose worst nightmare? Samsung's! Not Apple's.

      " . . .actually inventive and innovative Apple"

      How true that is!

      Good old Apple. Inventors of ...erm... ohyes!

      Pay by bonk (no)

      Slide to unlock (hardly)

      The smart watch (a few years late on that one)

      Overpriced and underpowered devices based on other peoples' technology and sold to people with more money than discernment (Ah yes, that'll be it)

      1. Anonymous Coward
        Anonymous Coward

        Re: Whose worst nightmare? Samsung's! Not Apple's.

        "and sold to people with more money than discernment (Ah yes, that'll be it)"

        Ay yes indeed. From your reply, here's what I can tell about you;

        1. You can't afford Apple stuff and feel deeply angry about those who can.

        2. Regardless of the effort and cost, you pursue mediocrity relentlessly. You feel threatened by anything that might just break you out of your self-made cheaply furnished prison.

        3. You know the price of everything, but the value of nothing. On the rare occasions you eat out ('because all restaurants are a ripoff; all they do is just heat stuff up') you argue the bill down to the last penny with your friends, sucking all the enjoyment out of each and every situation.

        4. You have an endless quantity of advice to give out, but strangely never manage to take it from others.

        Happy new year.

        1. Anonymous Coward
          Anonymous Coward

          Re: Whose worst nightmare? Samsung's! Not Apple's.

          "and sold to people with more money than discernment (Ah yes, that'll be it)"

          When I lived in that part of the world, a Hampstead café owner had a Rolls-Royce with a gold plated flying lady mascot.Today, blinged iPhones remind me of this.

          I happened to have an acquaintance who also owned a Royce of the same era. He had bought it when his mother died and left him lots of money. He had asked his wife if she wanted one too, and she said no, too big for London, she wanted a Honda Civic.

          Over the next two years the Royce was off the road more often than on while the Civic just ran like clockwork between routine services. I believe he eventually decided, not long after I moved, that the Royce would never be fixed to the point of actual reliability, and disposed of it at a huge loss.

          ...begin rant

          Now, I am not suggesting that Apple stuff is as unreliable as a 1970s Rolls-Royce. Nor is it in the same class of over-pricedness. But for years I did afford Apple kit. Gradually I noticed that failed motherboards, failed hard drives, and OS problems were just as common as with Windows machines and it wasn't clear what benefit I was getting. After the bodged transition to OS X a load of Apple kit was either sold or became landfill, and our business ran happily on the business products of Acer and Redmond, to the benefit of the bottom line. I swore a mighty oath on the bones of my ancestors that the Furies of Alan Turing would abide with me and my house if I ever was suckered by Apple again.

          Now what was I going to say? Oh yes, it's a bloody computer, not an objet d'art or, kayn anoreh, a status symbol. If the Chinese can churn out Honda-Civic equivalent mobile phones at Chinese prices, a combination of inverted snobbery and desire for value for money will eventually eat into the Apple market share outside the US. Because sometimes using a spade with a plain steel blade doesn't actually mean you can't afford a stainless steel one, it just means that a spade is only a spade, not a life affirming aesthetic choice.

          ...end rant

          1. Queasy Rider

            suckered by Apple

            is exactly my sentiment, said so here, last week. Thanks, was feeling lonely.

          2. Looper
            Thumb Up

            Re: Whose worst nightmare? Samsung's! Not Apple's.

            Arnaud the less: probably the most accurate comment on Apple I have ever read.

      2. gnasher729 Silver badge

        Re: Whose worst nightmare? Samsung's! Not Apple's.

        Well, what about Apple - inventor of stuff that people actually want. There's a reason why people stopped buying Samsung and the iPhone 6 is selling in record numbers. If you sell 80 million items, then it is by definition _not_ overpriced. If your sales drop, like Samsung, then you are overpriced.

        Apple is surely years behind others releasing a smart watch. But I'd say it looks a lot better than the Samsung watch with its unforgettable stalker adverts (creepy guy using his smartphone to secretly take photos of a girl. Cringe).

        1. Chika

          Re: Whose worst nightmare? Samsung's! Not Apple's.

          Well, what about Apple - inventor of stuff that people actually want.

          What about them? Actually, no, let's consider that Apple, despite having invented a few things over the years, aren't that much better than a number of other American corporates who invent a few things then spend the rest of their days sitting on their IP, filing countless lawsuits to back themselves up. While other corporates like Samsung and Google can stand up to this sort of thing and will give as good as they get, the people that suffer are the small fry who often do the real inventing work.

          As for phone sales and such, I took delivery of my Huawei Honor 6 this week. I've been a Huawei user for a couple of years now and though I often get odd looks when I tell people what I use, they are often impressed by the phone and, more notably, the price I paid to get it. I look at the cost of Apple and Samsung devices and realised long ago that paying that sort of money just for a badge cannot be justified unless they have a must-have functionality that is worth that extra cost. If not, I'm quite happy to let Huawei, Xioumi, Oneplus, ZTE or whoever tout for my business. They have proven themselves to me.

    2. Anonymous Coward
      Anonymous Coward

      Re: Whose worst nightmare? Samsung's! Not Apple's.

      China is the oldest continual civilization in existence, your comments insult thousands of years of technological innovation by one of the greatest cultures on the planet.

      1. This post has been deleted by its author

        1. pepper

          Re: Whose worst nightmare? Samsung's! Not Apple's.

          Well, it is generally considered to be a place where some sort of continued civilization has occurred, even though it has seen plenty of power switches(much like ye old Mesopotamia). Another contender for one of the oldest civilizations is Egypt, which has also seen a continued existence of a society much with the same genetic makeup.

          All in all, it's a silly/stupid statement that has not much merit from a historical perspective and generally paints with a extremely overtly big brush.

          1. Anonymous Coward
            Anonymous Coward

            Re: Whose worst nightmare? Samsung's! Not Apple's.

            If we want a really big brush, the loose area I inhabit was building megalithic monuments and herding sheep over 4000 years ago, and we are now still putting up stone monuments and herding sheep. There is a stone circle in Frome that was put up at the end of the 20th century, apparently without ironic intent. The main road is no longer a 300 metre wide drove road but the A303, but trade with the European mainland continues, there are still a surprising number of potters in the area making beakers, and there are still white horses and well endowed gentlemen cut in the chalk. I guess there are places where the view isn't that much different from what it was when the people at Durrington were still knocking up Stonehenge.

            Wessex culture, continuous for 4500 years. For some value of culture.

      2. Shannon Jacobs
        Holmes

        Eh, what's a couple of bad centuries?

        That really is the Chinese perspective on things. LONG term, and their interpretation is that it's about time to go back to normal, with the Chinese on top according to any metric of civilization you pick.

        However, on the topic at hand, I can report that I've had 3 Huawei devices over the last few years, including one smartphone, and all of them were quite satisfactory. Basically they have delivered on what was promised and conformed well to the standards. My other smartphone experiences have included a Samsung and an HTC, and something that Microsoft claimed to be some sort of smartphone.

        I do have some security-related concerns, however. I actually trust Huawei and think they are too smart to put any backdoors into their phones, but... The hardware is built in China and therefore accessible to the Chinese hackers. My belief is that a skilled hacker who has physical access to the device is an unbeatable combination. Nothing is perfect, and therefore I am basically assured that any device made in China has been most thoroughly explored by hackers, almost certainly including hackers who are working for the Chinese government.

      3. Voland's right hand Silver badge

        Re: Whose worst nightmare? Samsung's! Not Apple's.

        China is the oldest continual civilization

        Err... Bollocks. Multiple dark ages, multiple empire collapses, multiple history rewriting too. By that standard the modern specialists in accounting fraud residing on the south eastern edge of Europe are a part of the Ellinic civilization and their neighbours across the local pond are continuing the traditions of Chehiz Khan and Tamerlan empires. Or maybe not.

        A more apt description is "the oldest continuous history rewriting for ideological purposes". Including now. There were great civilizations on the territory of modern China. The region as a whole however is renowned for one thing: innovation not surviving.

        Just one example: they had fleets, naval power, ability to navigate in open sea long before Europeans. They did not just lose it (as many other discoveries), they carefully went around and erased any mentioning of it from their history books to ensure that this moment of greatness is not remembered. As a result we do not even know what the ship design was today. It was not the "junk as we know it" - they were according to the few remaining records 2-3 times bigger than Santa Maria. Nina and Pinta. And this was done again... and again... and again... After all - it is difficult to claim greatness when quite obviously you are sh... compared to your progenitors.

        1. Anonymous Coward
          Anonymous Coward

          Re: Whose worst nightmare? Samsung's! Not Apple's.

          "Just one example: they had fleets, naval power, ability to navigate in open sea long before Europeans."

          The Antikythera mechanism dates from the 2nd century BCE and uses gearing with a technical sophistication that could not be reproduced in Europe until the 18th century. We tend to think of civilisation continually evolving, but it has had major setbacks. Thanks, Romans, Scandinavians and Mongols.

        2. phil dude
          Thumb Up

          Re: Whose worst nightmare? Samsung's! Not Apple's.

          Thank you! You saved my typing a verbose academic riposte...

          P.

      4. croc

        Re: Whose worst nightmare? Samsung's! Not Apple's.

        Ah... That would be Australia's Aborigines, I believe... ~50,000 yrs. and counting.

  2. Bruce Ordway

    Huawei = Android?

    More of Android?

    Ref: http://www.theregister.co.uk/2014/08/26/huawei_only_has_love_for_android/

  3. John Molloy

    Well, here's the thing...

    "Yet Huawei managed to show something Apple couldn't in 2014: a sapphire phone."

    Dumping a few thousand phones on the market with a single special feature is pretty easy. But it looked at some point that Apple weren't going to get the yields high enough to ship the 10 million or so devices in the opening weekend and sanity prevailed and they went to the fallback position.

    Very easy to produce a product so you can shout "first" - Samsung is pretty good at this and it looks like Huawei have jumped on that bandwagon, however when it comes to Apple unit numbers this was a non-starter probably around June last year.

    1. DougS Silver badge

      Re: Well, here's the thing...

      Huawei weren't the first to market with a sapphire screened phone, there have been others, some even years ago. But as you say, those were a very specialized/limited run product.

      What Apple was/is trying to do that no one else has yet done is bring that technology to the mass market, which requires a massive increase in sapphire manufacturing. Neither they nor anyone else will be able to sell millions of them until that happens, and AFAIK Apple is the only one who has even tried to make the necessary investments to increase sapphire capacity.

  4. SuccessCase

    "Yet Huawei managed to show something Apple couldn't in 2014: a sapphire phone."

    The P7 still has Gorilla glass. I'm sure Apple could have "shown" the world an iPhone with Saphire glass in 2014 if they believed in pre-announcing future products. Pretty sure Sir Johny will have several tucked under his pillow this very moment.

  5. William Donelson

    It's the SOFTWARE, stupid. And Android is just a commodity.

    1. thames

      Smart phones in general are destined to be a commodity. As the average price steadily declines, there's less and less "bling" factor to owning any particular brand. It's like bragging about what brand of oatmeal you eat in the morning. Nobody really cares. I imagine some economist has attached his name to this as "Smith's law of commoditisation" or something like that.

      The Chinese are well placed to take advantage of a commodity market, as they are used to cut throat competition on razor thin margins, which are the hallmarks of any highly competitive market, Companies that can't adjust to that will either have to find a new "killer" product category (which is not easy), or else go out of business. I could quite easily imagine the two current smart phone market leaders doing a Nokia/RIM.

      1. Adam 1 Silver badge

        >I could quite easily imagine the two current smart phone market leaders doing a Nokia/RIM

        Mind you at least one of these can always fall back to selling forklifts, washing machines, HIFIs, refrigerators, vacuum cleaners, printers, cameras, air conditioners, bulldozers, CPU fans, hard drives, SSD, SD cards and a few dozen other lines. Even if they don't sell another phone ever again, they are not going to be like Nokia or RIM.

        1. pepper

          Or ships... Lot's of ships: https://en.wikipedia.org/wiki/Samsung_Heavy_Industries

  6. Kevin McMurtrie Silver badge

    Computer versus appliance

    I've had Samsung and Sony phones and am now using a Chinese Oppo phone. While Google and Apple are trying to make phone appliances, the Chinese phones are more like a pocket computer. They're more powerful, completely customizable, and they have all the bugs that come with those features. I don't see Chinese phones directly competing with iPhones because they appeal to completely different uses. As the open source community gains access to more brands of powerful unlocked phones, I do expect there to be a surge innovation and new expectations of what a phone can do.

    The losers in this game are telcos wanting to force customer lock-in with custom ROMs. The telcos can't keep up with fast-moving releases from Apple, Google, and AOSP maintainers.

  7. Charles Smith

    Consequences

    The business practices of off-shoring to China and other asian countries the production from the USA (and other European countries) to reduce prices has unintended consequences. It creates the infrastructure and human capital which allows the Off-shore to overtake the originator countries.

    1. Anonymous Coward
      Anonymous Coward

      Re: Consequences - just like the US

      Europeans offshored criminals, adventurers and awkward religious people to the American continent. The results are well known; access to cheap resources meant the US overtook Europe, though with a little help from the European inability to maintain peaceful internal relations. Around the turn of the 20th century it was the US that was the home of intellectual piracy, with ingenious local rules (you could only get a copyright on a book if it was being published in the US, for instance, so once you had published in Europe a US publisher was free to pirate it and claim US copyright.)

      The consequences of offshoring to China were so predictable that calling them "unintended consequences" would imply staggering stupidity on the part of managements.

      1. Alien8n Silver badge
        Alien

        Re: Consequences - just like the US

        In the semiconductor industry IP theft by Chinese companies is rife. It actually got to the point where if your product was truly innovative the last place you wanted to sell it was China. You'd have sales of 10's of thousands for months and then suddenly dry up. The Chinese companies would quite blatantly admit they stopped buying them because they'd figured out how to make them themselves.

      2. croc

        Re: Consequences - just like the US

        "The consequences of offshoring to China were so predictable that calling them "unintended consequences" would imply staggering stupidity on the part of managements."

        I prefer the more politically correct term "90 day tunnel vision".

      3. Adam 1 Silver badge

        Re: Consequences - just like the US

        >calling them "unintended consequences" would imply staggering stupidity on the part of managements

        I have no trouble accepting the premise of that statement

    2. Anonymous Coward
      Meh

      Re: Consequences

      Nothing new, did it with Japan long before that. They took the technology,ripped it off, then improved it and then pretty much killed a huge segment of the US / Euro markets...Cars, motorbikes, electronics. Eventually these companies fought back to regain some of the ground loss, only to repeat it again. No doubt when China kicks ass, we will recover, the repeat it all over again with Africa / South America this time.

  8. Jon B

    Xiaomi not landfill

    I wouldn't class Xiaomi as the landfill end of the market - the cheapest Hauwei is a lot worse than the cheapest Xiaomi.

    Xiaomi - High to mid, at low margin

    Huawei -High to bottom, high margin at the top, low margin at the bottom.

  9. Anonymous Coward
    Anonymous Coward

    Samsung are in a really strange position in that by most important measures their top end phones are much better than Apple's (my opinion, obviously, but I currently use an iPhone 5s and a galaxy s4) but they got it badly wrong by prioritising feature dump over user experience and ease of use.

    Given the apparent trillions they spent on marketing compared to Apple over the past 5 years or so they may well have missed their chance, especially now that Apple are finally doing bigger screens (whenever I go back from s4 to 5s that's the thing that jars most).

    1. Anonymous Coward
      Anonymous Coward

      apparent trillions they spent on marketing compared to Apple

      I have often seen the entire spend for Samsung - phones to washing machines - for a year compared to Apple marketing spend for a quarter. Samsung to Apples is almost certainly not a valid comparison.

  10. P. Lee Silver badge

    Bad news for Apple & Samsung?

    Yes, in that the numbers are against them in the Chinese market which might be important with the saturation of the West.

    Apple kinda got there first in West so they have the associated aura of "new/shiny". Not at all in the developing markets. Rather like an YSL handbag, nice if you have one, but not many people are that bothered about paying that much for them. As the razor thin-margin market continues, top-end premiums are harder to maintain.

    Mobile could easily end up just being a numbers game. Apple & other want some deep meaning or purpose for their kit. If they are mostly used for facebook, high-end vendors are going to struggle.

  11. Haro

    The limits of the Apple premium

    As a light grazer of economics, I'd be interested in what people think are the limits to the Apple premium. So far, I've heard someone say "You can't afford Apple stuff, you are scum.". This puts no limits. And, as well, Apple apps make more money per person than Android, because these people are rich.

    The premium is now at 2x compared to the Oneplus One, which is a fine phone. If it goes up to 3x, then all the arguments remains the same -- smaller market share of increasingly richer people. Why not go to 4x?

    1. Anonymous Coward
      Anonymous Coward

      Re: The limits of the Apple premium

      Carriers.

      Obviously carriers do not pay the full list price for Apple phones. Increasing the price to them will at some point cause them to go elsewhere. Increasing the markup for unlocked phones will, for a short time, make the carrier offers look better, but after a bit the world will get round.

      This is like cars in the UK where the main buyers of a lot of models are companies, who get a large discount. If the price for individual buyers gets too high, the depreciation starts to look very bad because the selling price will be that of ex-company cars of the same age.

      One of the selling points of iPhones in the US is that they mostly come bundled with contracts, and the second hand resale value is high. Raising the LP will make the depreciation worse, which will dent the "premium brand" image.

      I am sure Apple have real economists who work on this.

POST COMMENT House rules

Not a member of The Register? Create a new account here.

  • Enter your comment

  • Add an icon

Anonymous cowards cannot choose their icon

Biting the hand that feeds IT © 1998–2019