ZTE wants to concentrate on putting higher margin devices in more markets

ZTE wants to concentrate on putting higher margin devices in more markets
Chinese telecommunications and handset manufacturer ZTE has set its sight on markets outside of China, where they hope to find success with higher-margin devices. Long a produce of low-priced feature phones and discount smartphones, ZTE is hoping to produce premium smartphones that can go head to head with the likes of Samsung, HTC, and Motorola.

ZTE sells telecom equipment to carriers worldwide, and hopes to supply an even larger amount of the world’s telecom equipment as carriers upgrade to LTE in the coming years. While their enterprise deals have maintained a healthy profit margin, ZTE’s aggressive marketing of low-cost phones in emerging markets has led to a steady decline in the margins of their consumer devices division. By phasing out feature phones and selling more high-end devices they hope to improve those margins.

To foster in the transition, ZTE will be investing more into producing innovative smartphone designs, according to chief executive Shi Lirong. Shi referred to the smartphone market as a marathon rather than a sprint, and they hope to challenge some of the major players with their future products. ZTE currently ranks in the top five cell phone makers worldwide, but their share of the smartphone market is currently much smaller.

What do you guys think? If ZTE puts out a truly premium smartphone, will they find a receptive market?

source: the guardian

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7 Comments

1. username

Posts: 25; Member since: Nov 05, 2011

FIRST! i have a ZTE phone, don't really know the model. but to me its just a regular, mid-ranged phone.

2. roscuthiii

Posts: 2383; Member since: Jul 18, 2010

If it's truly premium then yes, they could have an audience here in the US. Problem is they are better known for low to mid range phones here. They'd be LG v2.0.

3. roscuthiii

Posts: 2383; Member since: Jul 18, 2010

And even their "better known" is more like "unknown" here in the States.

7. ardent1

Posts: 2000; Member since: Apr 16, 2011

ZTE and Huawei are using carriers like Cricket and MetroPCS to learn the US market. Metro has 9.1 million subscribers and since intoducing the android smartphone in 12/2010, it's about 30% of its base or about 2.7 million users. That is a lot of ZTE or Huawei android devices. That is just one carrier. ZTE offers a 4.3" screen device called the Warp on Boost. You will surprised how quickly ZTE or Huawei is gaining name recognition.

4. htcisthebest

Posts: 435; Member since: Nov 15, 2011

If they make a high-end device and make its price lower than iPhone and some high-end Android devices, I will buy it with heartbeat. The latter two are just ripping off people's $$ cauz their cost of production is so low compared to their selling price.....

5. ledbetterp3

Posts: 467; Member since: Aug 31, 2011

cool, can't wait to see what they can do!

6. ardent1

Posts: 2000; Member since: Apr 16, 2011

Give them 2 years and you will see great results. The designs of high-end smart phones are pretty much a generic shape these days -- it's a long rectangular device. Android OS is the same, the processors (Nvidia, TI, or Qualcomm) are the same, the cameras are the same, the parts are the same, the batteries are the same, so it comes down to design, materials, assembly, and innovative features like gottohave features. I expect the first 3 to 5 designs to suck, the next 3 to 5 designs to be better, the next 3 to 5 designs to be even better, etc. 2 years and you will have a credible competitor. My advice to ZTE, use stock android.

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