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Huawei Plans To Revive China's Smartphone Market With An Updated Mobile Operating System

Huawei Plans To Revive China's Smartphone Market With An Updated Mobile Operating System
In an effort to strengthen its smartphone business once again, Huawei on Friday unveiled HarmonyOS 4, the newest version of its mobile operating system, and an improved A.I assistant.
The Shenzhen-based telecom company is attempting to recoup from U.S. sanctions that cut it off from crucial technology like semiconductors, such 5G chips and software, beginning in 2019. The action rendered its once-dominant position in the smartphone market unviable, crippling it.
The Android mobile operating system was shut off from Huawei by American limitations, which had a devastating effect on the company's smartphone sales outside of China.
In an effort to displace Android, Huawei released HarmonyOS in 2019 as its own operating system. Since then, the corporation has been working on new iterations of the system in an effort to reclaim some market dominance in smartphones.
The company's desire to strengthen its smartphone business is highlighted by the launch of HarmonyOS 4 on Friday.
“Huawei’s flagship smartphones are making a comeback,” said Yu Chengdong, CEO of Huawei’s consumer business and intelligent automotive solution business groups, during the Huawei Developer Conference 2023 on Friday.
Huawei has been concentrating on regaining market share in China since 2019, with some success. In China, Huawei's market share increased to 13% in the second quarter of this year from 7.3% in the same quarter of 2022. Shipments of smartphones by the company increased 76% year over year.
The focus of Huawei's strategy has changed from competing in all markets for smartphones to focusing on the luxury segment.
“Huawei’s smartphones took the second spot in the high-end segment. So we are making a comeback with vengeance,” said Yu.
According to IDC, Huawei's market share increased to 18.4% in the second quarter from 6.7% in the same period in 2022 in the category of Chinese phones costing more than $600.
Given that Chinese consumers are typically prepared to pay more for smartphones, Huawei's high-end concentration makes sense. The Mate X3 foldable, coupled with the company's flagship P60, helped the company increase its share in the premium segment this year.
Huawei intends to reenter the 5G smartphone market by the end of this year despite being cut off from essential foreign components, according to Reuters. According to the news source, Huawei should be able to find 5G processors domestically.
Next-generation mobile internet technology is referred to as 5G. The majority of high-end phones can connect to 5G networks, which guarantee incredibly fast internet connections. Due to American restrictions, this capability has been absent from Huawei's flagship devices.
“It totally makes sense for Huawei to focus on the premium segment. It’s not only that the high-end segment was more resilient in the gloomy Chinese market, but Huawei could also leverage its premium brand name in China, which other Chinese vendors were still striving for,” Will Wong, research analyst at IDC, told CNBC.
“Furthermore, premium products could potentially generate more favorable revenue and profitability.”
HarmonyOS, an operating system Huawei claims is intended for smartphones as well as other devices like wearables and TVs, is a key component of Huawei's high-end strategy. Like Apple, the company wants to produce unified software for several consumer electronics categories.
The massive Chinese tech company promised to introduce "a HarmonyOS with even more intelligent and personalised experience." According to the business, HarmonyOS is currently installed on more than 700 million devices, including tablets, watches, and smartphones.
According to Huawei, the Pangu AI model has been used to train the updated Celia AI voice assistant, which offers assistant functionality on smart devices, to increase efficiency both at home and in the office.
Huawei released Pangu 3.0 in July in an effort to cash in on the ChatGPT craze and the AI surge.
According to Huawei, at least 200 million mobile phone users engage with Celia each month.
“You can interact with Celia by not just voice but also texts, pictures, documents and so on. You can also type to interact with Celia if it’s not the right time to talk. Dialogues between users and Celia can be more natural and intuitive,” said Jia Yongli, director of consumer business at Huawei.
According to Jia, Celia is also capable of carrying out a variety of activities, including translating, sending emails, and creating official papers.
A fresh set of capabilities will also be made available to invited users in late August, according to Huawei.
Still, China, which accounted for 89% of Huawei's handset shipments in the second quarter, is expected to remain the country where the company's smartphone revival is most likely to occur.
This is due to the fact that Huawei's phones still don't support 5G, and HarmonyOS lacks popular apps that users outside of China are accustomed to utilising, like Google.
“It’s not an easy task to regain ground overseas,” Wong said, suggesting many users have switched to other phone brands due to Huawei’s lack of key features.
“It would take time for Huawei to get the users switched back even if it could address the key pain points of its products in the overseas market now.”

Christopher J. Mitchell

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