Huawei’s ban: who are the biggest winners?

This article may contain personal views and opinion from the author.
Huawei’s ban: who are the biggest winners?
Even those that aren’t particularly interested in smartphones and mobile technology are now aware of what’s happening with Huawei. The news about the US ban of the Chinese tech giant has been covered by pretty much every media outlet around the globe. And while those stories are often followed by what the consequences for Huawei will be, there isn’t that much talk about what the consequences for other manufacturers will be.

With that, we don’t mean the part suppliers that will lose one of their biggest clients. Instead, we’ll look at those that will benefit the most in the upcoming months (years?) as the reality of the ban sets in and we start seeing it affect the market in a more direct way.

As you’re probably aware, the main reason for the US government’s actions is the fact that Huawei networking equipment is broadly used within the States and is allegedly compromised in a way that serves the Chinese government. And we will take a brief look at what will transpire in the networking sector once Huawei is out of the picture, but first, we’ll focus on the smartphone market.

Winners in the smartphone market


You don’t have to be an industry insider to quickly realize which companies stand to benefit the most out of Huawei’s mishaps. A quick look at the list of the world’s biggest smartphone makers will give you a solid answer.


Huawei recently made its way to the second spot on that list, sandwiched between Samsung at number one and Apple at number three. And while Apple will probably see a slight boost in sales as well, it’s not really worth looking at since Huawei doesn’t have a presence in the States where Apple holds a huge market share. Instead, the company at number four on that list - Xiaomi will reap a rich harvest in the upcoming months. So, Samsung and Xiaomi then? Well, let’s see how they’ll look to make the best of this situation.

Samsung has all bases loaded


Samsung seems so well prepared to handle fleeing Huawei customers that it almost feels like the company knew in advance something like that will happen. The South Korean manufacturer has stacked its smartphone lineup from top to bottom. This year alone, Samsung has released three budget phones from the M series, 9 mid-range phones from the A series and 4 S series flagships, with at least two Note 10 models rumored to come out in August.

So, depending on the needs of each individual market, Samsung can pick the most suitable models from each line and with the help from its marketing department, it can quickly make people forget Huawei ever existed. To top it off, Samsung’s latest devices are some of the best in terms of quality and value for your money it’s ever made, so it’s not like customers are getting a bad deal.

The Huawei ban couldn’t have come at a better time for Samsung. The Chinese giant gained a ton of momentum over the past few years and was passing competitors like they weren’t even trying. Once Huawei reached the number two spot globally, there was only one target left on its list: Samsung. But now, with sticks coming between Huawei’s spokes from all sides, it seems that run has ended. Now all Samsung’s left to do is make sure it has enough room in its belly for a big piece of Huawei’s pie. But it’s not the only company preparing to feast on Huawei’s delights.

Xiaomi has a chance to become the top Chinese phone maker


Even today, when people hear the name Xiaomi, most think of it as some obscure Chinese brand (if they’ve even heard of it before). And while that’s true in the States, in Europe, Asia and South America the company is now a major player on the smartphone market, which is how it reached the fourth spot on the biggest manufacturers’ list. Still, if it wants to fill Huawei’s shoes, there’s a lot more work left to be done.

Xiaomi likely won’t reach Huawei’s technology levels in the field of smartphone cameras, chips and other developments but the company has been steadily releasing better and better high-end models. Known mostly for its super-aggressive pricing strategy, Xiaomi is now trying to shake off the “cheap” stigma off its name and move towards higher price segments, where Huawei has successfully positioned its Mate and P series flagships. Xiaomi will try to do that without losing its customers that are used to buying well-specced phones on the cheap. The attractive prices fueled its impressive growth over the last few years but now its time to change gears.
 

In order to not lose ground on the so-called emerging markets, however, Xiaomi separated the subbrand Redmi into its own entity that will take over the budget to mid-range smartphones. Or at least that was the initial plan. In a move that doesn’t seem to fit that strategy, Redmi just recently announced the Redmi K20, a phone with Qualcomm’s best chip, the Snapdragon 855, meant to become the next “flagship killer”. Now that it has a flagship in its lineup, it seems like Redmi is becoming to Xiaomi what Honor is to Huawei, rather than just a brand for cheaper phones.

Either way, Xiaomi is in a strong position as well. However, if it wants to take full advantage of the situation, it will need more than lucrative smartphones to offer. The company will have to pour some serious money into marketing in order to become a household name and get associated as a brand that’s a viable alternative to Samsung and Huawei in the premium segment. That will be an even harder challenge now that the ban has put a stigma on Chinese phones not only in the States but worldwide as well.

So, on the smartphone front, Huawei’s competitors have their claws already sharpened, but what about the networking business?

Winners in networking equipment 


When it comes to networking, the most important thing to talk about is our favorite 2019 buzz word — 5G. Since 5G is a new and up-and-coming technology, telecommunications providers around the world are gearing up to introduce it to their customers. The different frequencies 5G uses means that existing base stations have to be upgraded and new ones put in place to provide better coverage because of 5G’s limited ability to pass through obstacles.

Of course, for hardware vendors such as Huawei, this means billions of dollars in orders up for grabs. And Huawei was in a very good position to get a good chunk of those orders. The company’s 5G equipment is considered to be the most advanced right now, some claims putting it more than a year ahead of the competition. However, now that the winds have changed, the wide adoption of Huawei hardware seems less likely. Of course, there will still be plenty of carriers that choose Huawei’s equipment for their networks, especially in China and other Asian markets. But in the States and in some European countries that have been considering similar restrictive measures, that’s out of the question.

Nokia (the real one, not the company that makes Nokia-branded phones) already has strong standings in the US. The company is working alongside Qualcomm to provide some of the hardware required for the 5G networks of Verizon, T-Mobile and AT&T. 

T-Mobile is also working with another company once known for its mobile phones - Ericsson. Ericsson remains one of the biggest networking hardware providers in the world and has proven it’s up to the task by providing Swisscom’s 5G network in Switzerland, currently covering 54 cities in the country.

Meanwhile back in the States, AT&T is partnering with a couple of other familiar faces - Samsung and Intel. Samsung is unsurprisingly providing most of the hardware for South Korea Telecom’s own 5G network as well.

So, we have the whole bunch: Samsung, Nokia, Ericsson, Qualcomm, Intel. And those are just the big players. Many more smaller companies will fill various niches left empty after Huawei’s exile. And as the Chinese giant faces an uncertain future, all the rest are preparing for a feast.

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25 Comments

1. User123456789

Posts: 674; Member since: Feb 22, 2019

According to report in 2018, about 80% of huawei sales are in China. Most of them are Honor branded. Still you find people that say Trump is protecting Apple sales.

5. Pabliell

Posts: 179; Member since: Mar 22, 2016

Yeah, especially if China decides to screw up US and ban Apple, while Apple has about 30% of all iPhones sold there.

7. User123456789

Posts: 674; Member since: Feb 22, 2019

Judging prices Apple charges outside North America, they dont need China. Best version of xs max here had almost 2x the price of note 9 128Gb.

9. Reviewerofstuff

Posts: 119; Member since: Jun 02, 2018

They do need china. For making their phones. Also 30% of sales is huge and would be a very big impact on Apple. Stop acting like China is powerful to do anything to retaliate.

11. User123456789

Posts: 674; Member since: Feb 22, 2019

Production can be moved to other cheap places like India, Thailand etc .... Part is already made in India.

14. shm224

Posts: 276; Member since: Mar 19, 2015

It's not going to happen overnight and India has only been making older, lower-end iPhone models.

20. oldskool50

Posts: 962; Member since: Mar 29, 2019

Production could be cheap, but the tariffs to ship them here wont be. That's what you guys don't understand. China used it banks to buy over 1.2 Trillion of the US Debt. They did this do that the. Chinese Yuan would have more value vs the US dollar. Because of this China was a le to lower the tariff prices which allows US ma manufacturers to move more production to China, because it would. E cheaper to shop stuff back here vs doing it anywhere else. Getting a cheaper production cost has nothing to do with the cost to ship it back to the US. Please go and learn all the facts. If China wanted to ruin the US all they have to do is, make the US pay that debt purchase back, raise the costs of the tariff's or they could simply ban all exports to US companies and extort them for high amounts of money to receive their goods and their is nothing the US could do about it, because the Chinese Govt owns all the courts in China and everything else. They are a Communist country dude a d their is nothing US companies could do to sue them. So China if they wanted too, can do a lot to hurt the US. But they want to do this right. But they don't want to agree to sole BS deal from dirty Trump. Trump is not.offering a fair deal. China doesn't want what happened to the people who.were nm living in North America that we now call US Ameri8cs to happen. With them. Where the US made promises which were just lies and they stolen this country from its inhabitants.

24. jacky899

Posts: 427; Member since: May 16, 2017

Idiots keep saying Apple already moved production outside of China. Those cheaper places only account for less than 5% of Iphone productions and mainly for older phones. To build a manufacturing infrastructure, environment, capacity, and staff experience to the level it is in China now, will take 5 to 10 years. People saying it is easy to just move manufacturing out of China clearly have never worked on any big projects to understand how much work and time is required.

13. shm224

Posts: 276; Member since: Mar 19, 2015

Samsung makes the majority of their phones now in Vietnam. It's taken them about 6 years to make that move (from China) without anyone noticing it, but if the largest smartphone company in the world can move it, so can Apple.

21. oldskool50

Posts: 962; Member since: Mar 29, 2019

Samsung owned its China factories. APPLE does not own any factories. Big difference. Yes Apple could kove it, assuming they can make a deal for someone to make their products. Which is harder than you think. Apple.os Cheap, that is why they are in China to begin with. Yes there are other Asian countries, but with exception of Japan, others may not want US companies there.

12. shm224

Posts: 276; Member since: Mar 19, 2015

Apple's sales in Greater China is only about ~17% and declining. I wouldn't worry about it too much.

10. Shubham412302

Posts: 568; Member since: Nov 09, 2011

Huawei is much bigger than you think.https://www.youtube.com/watch?v=QVUUspncf4E

19. oldskool50

Posts: 962; Member since: Mar 29, 2019

Because he is for the US. If Huawei brought phones to the US market, Apple would lose lots of sales, because Apple will refuse to release phones at the same price points. The fact is, just like outside the US, buying a Huawei phones with better E EVERYTHING Including the OS at as much as 70% less cost would basically ruin Apple. If you can't see this, then well its tour problems. Protecting Apple is likely a very small part of the equation. That doesn't mean it isn't part of it. You cannot dismiss it, e cause the signs are their. Look how fast Huawei moved up in other countries outside of China. Even without the US market. You can't be blind to those facts, unless you choose to be.

2. Shubham412302

Posts: 568; Member since: Nov 09, 2011

Check this latest Huawei videohttps://www.youtube.com/watch?v=f4lZe4Zmhzw

3. scarface21173

Posts: 646; Member since: Aug 17, 2014

Do you not think the damage has already been done to huawei, even if they lift the ban.

4. Pabliell

Posts: 179; Member since: Mar 22, 2016

Not really. Huawei has stockpiled enough resources to function for some time, so if the ban is lifted, their contracts signed again, they can continue working on new products using old plans they already had. But they have to lift the ban really soon, otherwise it might mean supply shortages at Huawei.

15. shm224

Posts: 276; Member since: Mar 19, 2015

Well, Huawei doesn't really need a lot of "parts" from American companies. Huawei can still make stuff without IP/license from Qualcomm, Google, ARM, etc, it's just that they can't sell them outside China. The company however can't make any stuff without components from South Korea and Japan where most important components are still made. When push comes to shove, Trump might ask them to stop supplying parts, then it's game over.

8. Shubham412302

Posts: 568; Member since: Nov 09, 2011

I bet over 90% people dont even know about this.

16. shm224

Posts: 276; Member since: Mar 19, 2015

Most American have no idea what Huawei does or what products they make.

6. surethom

Posts: 1635; Member since: Mar 04, 2009

We need more choice, more AMOLED screens on phone with 5.9" to 6.2" screen size other than Samsung not just massive phones, that's what Huawei are doing well.

17. shm224

Posts: 276; Member since: Mar 19, 2015

?? Huawei also uses Samsung AMOLED displays. Huawei's only other display suppliers BOE and COE are staffed mostly with former Samsung employees with stolen Samsung technology.

18. chenski

Posts: 755; Member since: Mar 22, 2015

In the long term everyone loses

22. mootu

Posts: 1449; Member since: Mar 16, 2017

What hasn't been mentioned yet is that Nokia and Ericsson both manufacture most of thier equipment in China under partnerships with Chinese firms. These are not contract manufacturing as in Apple / Foxconn they are actual 50/50 partnerships. This means they are subject to Chinese local law and that if the Chinese Gov. requests them to comply then they have no choice but to do so. Nokia and Ericsson both have members on thier boards who are members of the CCP. https://www.smh.com.au/business/companies/top-​5g-suppliers-linked-to-china-s-communist-party-201

23. mootu

Posts: 1449; Member since: Mar 16, 2017

Another thing that is being swept under the carpet is that Apple currently licences 769 patents from Huawei. These patents cover LTE, GSM etc. This costs Apple over a $billion per year. These are essential patents needed for connecting to the internet and cannot be licenced elsewhere, but under US law no US company can do business with Huawei. So when the 90 day reprieve ends Apple cannot legally sell any device with a modem containing Huawei patents, which is all of them.

25. XyAzario

Posts: 35; Member since: Mar 15, 2019

"So when the 90-day reprieve ends Apple cannot legally sell any device with a modem containing Huawei patents, which is all of them." Really, that's something new. Where did you get that information from?

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