Huawei is heavily burdened by US trade sanctions and sees its smartphone sales decline significantly. Due to recent events asks Android Planeteditor Rens is increasingly wondering: will Huawei stop with smartphones or will the brand continue to hope for a miracle?
Read on after the ad.
Sanctions are getting harder on Huawei
For those who missed it: The US government blacklisted Huawei in May 2019. The Chinese tech giant sees it as a security risk. Public evidence for the associated espionage allegations has never been provided. The sanctions work, and how.
It is more difficult for Huawei to purchase components for its laptops and smartphones and is no longer allowed to have its Android devices certified by Google. In addition, it can no longer develop smartphone processors through its Kirin business unit.
The consequences of the sanctions are becoming increasingly clear. Huawei has recently sold its subsidiary brand Honor to a new owner, is forced to buy smartphone processors from competitors and sees its device sales fall quarter on quarter. The latter, in particular, is likely to become a growing problem.
Especially now that it seems that the new US president Joe Biden is sticking to the sanctions of his predecessor Donald Trump. Earlier I explained why Biden is important for Huawei’s future; he can remove the brand from the blacklist.
Is Huawei stopping with smartphones?
Huawei was well on its way to becoming the largest smartphone manufacturer in the world in early 2019. Apple had already caught up and Samsung felt Huawei’s hot breath on its neck. Two years later, things are very different. Honor has been sold as said and there are rumors that Huawei is investigating the sale of its P and Mate series smartphones. These are Huawei’s most expensive and advanced smartphone ranges, with which the company previously competed with Samsung and Apple.
It is no longer possible to compete since the brand has to use a non-certified Android version. That software lacks the Google apps, the important Play Store and a clear update policy. Huawei is trying to offer alternatives with its own services and the AppGallery app store, but is still miles behind.
The manufacturer can also still not guarantee an update policy for its smartphones, making it uncertain whether the Huawei Mate 40 Pro, which costs 1199 euros, will get Android 11 at all.
Huawei in the Netherlands
Due to the moderate user experience and still high prices, I (like my colleagues) can hardly recommend a Huawei smartphone anymore. I also see that sad conclusion in practice. Huawei’s smartphone branch is gradually disappearing from sales channels in my opinion. Providers are now only offering a handful of Huawei devices, the Huawei radio and TV commercials have become scarce and the life-size posters on bus shelters across the country are long gone.
(web) Shops place clear warnings on the product pages of modern Huawei smartphones or no longer offer the devices at all. And where Huawei was prominently (and dearly paid) visible in large electronics stores two years ago, I now mainly see demo tables from Oppo and Xiaomi in those places.
What I’m saying with this: Huawei smartphones are less in demand, less promoted by partners, and Huawei seems to prefer to spend its massive marketing budget on other product categories. Just notice how much attention there is nowadays for Huawei’s smartwatches, wireless earbuds and laptops.
P50 series with HarmonyOS?
The key question is of course: will Huawei stop developing and selling smartphones? No one can answer that question right now, not even Huawei. The company may persist and hopes for a (political economic) miracle. If the company disappears from the sanction list, it can ‘normal’ business again and release more competitive smartphones again.
I don’t think this is likely to happen and rather think that Huawei will sell its smartphone arm, just as it has divested Honor. This spring, the manufacturer seems to be launching the Huawei P50 (Pro) and it will not surprise me if these turn out to be the last expensive Huawei smartphones.
The P50 series may appear in two variants: with Android and Huawei’s own HarmonyOS. Will HarmonyOS be Huawei’s salvation? Without Google services and a complete app store, I don’t expect much from it.
How do you envision Huawei’s smartphone future? I’m curious and would love to hear your opinion in the comments below!