ZTE exec compares China’s mobile sector to photovoltaic industry. Says it’s headed for a crash in 3 years

Domestic mobile device industry in China is booming. 4 out of ten top smartphone makers in the world – Lenovo, Huawei, ZTE and Coolpad/Yulong- come from China. New upstarts like Xiaomi and Oppo are flexing their muscles, showing global ambitions with innovative products and interesting business models. And localy focused companies like Meizu, TCL, THL, Neo, etc; are coming up with ever more interesting stuff, at ever more interesting prices. Give it a few years, and all this innovation should explode on a global scale, ushering in an era of Chinese dominance in mobile.

Or not.

ZTE’s Executive Vice President He Shiyou is worried that China’s mobile boom may not end well. And that the industry is headed for a crash within three years.

ZTE logo 750px

He thinks that heavily promoted by carriers, China’s domestic phone industry has gotten too large. It now faces huge inventory and production overcapacity problems, which may become fatal soon.

He Shiyou compared  domestic smartphone OEMs to once booming photovoltaic sector. With strong government support, China’s solar panel industry grew very fast for several years, and became a serious global player. Only to crash and burn after reaching unsustainable levels. ZTE EVP sees similar scenario, with a lot of contraction and company bankruptcies, playing out in mobile.

To preempt future problems, ZTE is no longer focusing on market share growth in China.  It is getting out of the low end smartphones at home, and is now moving up-market with branded higher-end products globally.

Author: Stasys Bielinis

While I like to play with the latest gadgets, I am even more interested in broad technology trends. With mobile now taking over the world - following the latest technology news, looking for insights, sharing and discussing them with passionate audience - it's hard to imagine a better place for me to be. You can find me on Twitter as @UVStaska'

Share This Post On