Huawei’s current chairman sees lower growth next year
As the year started, Huawei estimated that it would ship 300 million handsets in 2019 and hoped to surpass Samsung to become the largest smartphone manufacturer in the world. If Huawei did deliver 240 million phones this year as Xu wrote in his memo, it would mean that the company fell 20% short of its goal.
Huawei has a game plan for next year that includes pushing its own app ecosystem called Huawei Mobile Services as a way to replace Google’s ecosystem. This could allow the company to drive sales outside of China. Xu’s memo also discusses expanding the use of chips designed by the company’s HiSilicon unit for the enterprise and in the cloud.
For Huawei to be allowed to access its U.S. supply chain again, it will have to be taken off the Commerce Department’s entity list. Earlier this year there was talk that Huawei could be used as a bargaining chip by the U.S. in order to get better terms for a new trade agreement with China. But so far, any negotiations between the two countries have not included Huawei based on wire service reports.
The Trump administration considers Huawei to be a national security threat because, under the laws of China, the government can demand that the company spy on consumers and corporations and send that information to Beijing. U.S. lawmakers fear that Huawei’s phones, tablets, and networking gear contain back doors that will transmit illegally acquired information to the Chinese government. As a result, the U.S. has warned allies not to use Huawei’s equipment to help build out their 5G networks. The company happens to be the largest manufacturer of networking equipment in the world. We should point out that Huawei denies all of these allegations.
Xu does not sound optimistic about 2020 with his talk of closing or shrinking divisions and laying off employees. And who knows how long Huawei will remain a darling of Chinese consumers. If Huawei still hopes to become the most popular smartphone manufacturer in the world, it will have to get off the entity list somehow.
Written by Alan Friedman.
View the original article at here.
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