The Rise of ZTE as a Smartphone Powerhouse

by Matt Klassen on August 10, 2011

I will admit that my use of the word “rise” has distinct air of Western orientalism to it—in much the same way adventurers from the Western world used the word “discovered” when they happened upon a lost city only to find it crawling with indigenous peoples—because the Chinese-based mobile company ZTE has been around for ages, just not here in North America.

In fact, despite the fact that ZTE has almost no presence in the U.S. mobile market the Chinese mobile manufacturer is quickly becoming a global mobile powerhouse, reportedly selling some 35 million handsets in the first half of this year alone, moving the company into the position of 5th largest handset vendor in the world.

Ignoring the point that almost all of our “western” mobile devices are produced in China anyway, how long will it be before this Chinese company invades the U.S. mobile market and the name ZTE becomes as common as Apple, Samsung, or HTC? Given that ZTE is following the marketing strategy of the latter HTC, who itself focused first on developing its global brand before attempting to break into the North American market, I would say not long at all.

It’s truly interesting to compare the global smartphone statistics against the more localized U.S. stats, as it really gives a clear picture of who is able to sell to Americans and who is able to sell to everyone else.

A company like Apple, for instance, who enjoys meteoric success in the America market, has found in the last few years that its expensive iPhone has priced itself out of many foreign markets, while Google continues to flood the earth with its Android deluge. The point being, of course, that just because it’s popular here doesn’t mean its popular elsewhere, and vice versa.

It is a similar kind of story for ZTE, a company that has had great success in the Chinese mobile market for many years now but has all but failed to break into the North American market–through only some fault of its own. Its popular phones like the Blade have clear appeal to both Asian and European mobile users, but I would wager that should it hit shelves here it would be about as impressive as the newest Blackberry—which is to say, not that impressive at all.

But ZTE is looking to change all that using much the same strategy as market mainstay HTC used the last few years to create and sustain its North American reputation, growing its global brand.

When HTC was looking to compete in the US mobile market several years ago it came as a relative unknown, an issue that is almost always guaranteed to spell failure on this side of the pond. So the Taiwan-based company took its time, grew itself in other foreign markets, and honed its product and its brand until it was ready. ZTE is hoping to do the same.

As it stands, while 35 million units sold is a number to be proud of–a huge increase in sales over this time last year– most companies like ZTE still see the American mobile market as the golden apple, the measure of true success. So while you haven’t heard or seen at ZTE phone yet, you soon will, as the company has stated it plans to release at least one smartphone in the U.S. on a major carrier—something to date that its been unable to do.

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Written by: Matt Klassen. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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