On February 22, Huawei released its folding flagship phone, the Mate X2, equipped with Huawei's current top-end 5nm Kirin 9000 chip, priced from 17,999 yuan.
"We have prepared a large enough capacity, and we are increasing capacity every week and every month." Yu Chengdong, CEO of Huawei's consumer business, said at the launch. However, because of the lack of chip supply, more than 3 million people lined up to make reservations, Huawei "a machine is hard to find", the difficulty of grabbing it can be seen.
It's no exaggeration to say that after other cell phone manufacturers have warmed up, Huawei jumped off a cliff and plummeted in stark contrast to the previous growth, "core change" so that Huawei has always been a strong leader in the biggest losers.
At the same time, Huawei founder Ren Zhengfei said in an interview, Huawei will never sell the terminal business, and pointed out that the terminal does not only contain the cell phone business, but a lot of business in general. "We would rather transfer 5G technology than give up the terminal business" and "Huawei can survive without relying on cell phones."
In response, recently, Huawei publicly mentioned for the first time the previously rumored "Nanniwan" plan, that is, the production of self-help, including in the field of coal, steel, music, and said Huawei does not rely on the cell phone business can also survive.
And Huawei machine vision field president Duan Aiguo directly in the network broke the news, said Huawei has launched the "Huawei intelligent pig solution", announced that Huawei machine vision to be in the wisdom of the pig on the strength of AI to enable pig intelligent upgrade.
Harder to buy than Maotai & sales plummeted
On September 15, 2020, Huawei Kirin chips were officially cut off. Because the chip is not enough, Mate 40 although in many channels has been speculated to 8,000 yuan, still a machine is difficult to find, and once on sale, immediately appeared "sale that is exhausted" situation, and even some users flirted with Huawei cell phone than Maotai is still difficult to snatch, and now, it is 3 million people waiting in line to snatch the price of 18,000 Mate! X2, Huawei cell phone hard to grab more and more intense.
In the U.S. ban before the escalation, according to the data released by Jingdong self-provisioning in March 2020, Huawei Department sold 802,000 units, accounting for 38.5%, ranked first; in contrast, after the ban came into effect in December, Huawei's cell phone sales plummeted by 70%, down to 266,000 units.
And according to the latest sales figures, Huawei's phone sales plummeted 42.4% globally in the fourth quarter of 2020, with sales dropping directly from 56.2 million units in the fourth quarter to 32.3 million units in 2019.
IDC statistics also show that Huawei ranked fifth in global market share, shipping 32.3 million units. The market share share was 8.4%, which is a significant drop in market share from 15.2% in 2019. And before that, in the third quarter, Huawei was in second place, and slipped to fifth place in one quarter.
Obviously, Huawei's phone shipments took a big hit. After all, as recently as the second quarter of 2020, Huawei's phone sales had been the number one in the world.
Originally, because of the 5G technology, Huawei cell phone has an absolute first-mover advantage, but the reason for the ban, but let Huawei cell phone in the "core" available in the embarrassing forbidden, and at least so far, Huawei still did not get out of the trap, the situation faced by the cell phone business is also more and more serious.
In order to alleviate the chip crisis, Huawei Huawei cell phone purchase restrictions, each person is only allowed to buy 2 Huawei cell phone; also bear the pain of the glory of its cell phone sold wholesale, in order to survive.
Recently, the Ministry of Industry and Information Technology showed a new Huawei phone into the network, codenamed ANA-AL00, but according to the information, this phone is a 4G phone. And many friends have already flocked to 5G cell phone products, even Apple has already come out with a generation of 5G iPhones.
Of course, there are also relevant people broke the news that the Huawei P50 design is basically completed, and is about to enter the mass production stage. As well
According to Tencent News, as of the first half of 2020, Huawei has invested 180 billion yuan in chip inventory, enough for Huawei to support a year's supply of chips.
But given that Huawei has not yet completely resolved the chip crisis, Huawei's chip shipments in 2021 may have a further decline, and it is not easy to say whether the new product out can solve Huawei's pressing problems.
Canalys data then showed that in the fourth quarter of 2020, Huawei (including glory) shipped 18.8 million units in China, with a market share of 22%, although still in first place, but compared with the same period in 2019, it slipped by 44%, and the lead over the second place was shortened from 22% to 2%.
Of course, Huawei has always emphasized that letting go of glory does not mean giving up the cell phone business, and the day before Huawei's official announcement of Yu Chengdong's concurrent appointment as president of the Cloud and Computing BG, on January 26, Huawei has just denied the sale of Huawei's Mate and P series cell phone business.
But the fact of the matter is that Huawei will have to face the risk of further shrinkage in its handset business.
The butterfly effect of chips
The ban starting in 2019 is just an appetizer, and will have little impact on Huawei initially. But then, until 2020, the U.S. Department of Commerce issued a message that all manufacturers using U.S. technology are prohibited from supplying Huawei with chip design and production.
Guo Ping, Huawei's rotating chairman, has responded that Huawei consumes hundreds of millions of cell phone chips every year. For this reason, Huawei's current strategy is to use a limited number of chips to do unlimited business extension, so it will use a limited number of sales to ensure market participation. From the Kirin 820E debut, Huawei is doing exactly the same thing, can only "squeeze toothpaste" on the chip.
Earlier, the media said that Huawei's cell phone business can not hold out, will sell the cell phone business, and said that Huawei as a whole will return to the "government and enterprise" as the main mode of development, and no longer have a direct consumer-oriented terminal business. Since then, Huawei quickly issued a response, officially said Huawei has no plans to sell the cell phone business.
But then, Huawei in 2020 to bear the pain of divesting glory. First, in October, the Internet rumor that Huawei is ready to sell part of the glory with 3.5 billion U.S. dollars, and then to the beginning of November, the Internet rumor that Huawei will be packaged to sell the glory, the acquirer at that time also made a lot of noise, TCL, Shenzhou and so on have to enter the game. Subsequently, on November 17, Huawei officially announced the decision to sell glory business assets as a whole.
Prior to this, glory as Huawei's internal incubation of an independent brand, has always maintained a relatively independent operation, Huawei + glory dual-brand combat, high-end market has Mate and P series, low-end market has glory, in this case, the sale of glory can be seen as Huawei in the United States under the political suppression of the self-help, which will change the pattern of Huawei's cell phone business.
It's also why there are related rumors that Huawei is in talks with a consortium led by an investment firm backed by the Shanghai government, in the early stages of negotiating the sale of its high-end smartphone brands, P and Mate. The reason the talks are said to have been going on for months is that is because of a lack of chip supply.
But Ren Zhengfei took a direct stance in an interview, saying that Huawei could transfer 5G technology, but would never sell its terminal phone business. And Ren Zhengfei also explained that Huawei terminal business is not limited to the cell phone business, as long as the connection with people and things are, such as the use of LiDAR in the car driverless, the family application of the gas meter, water meter, TV, etc..
After being asked by the media, "Now that Huawei's cell phone business revenue is inevitably declining, Huawei is also gaining revenue from other new points of opportunity, do you think these revenues can offset the decline in the cell phone business? If so, how long will it take to go through?" Ren Zhengfei also said, "I think that this year will be about right."
Only, the form is stronger than the person, about the glory Ren Zhengfei has also said, this is for more suppliers as well as employment issues to consider.
Qualcomm CFO Akash Palkhiwala had also said at the earnings conference that with Huawei's decline in the smartphone chip market, Qualcomm is ready to raid Huawei's empty 16% chip market share.
And from the specific performance of the current glory, it is in the middle of getting rid of the chip. At the time of the release of the new glory in January, Zhao Ming, CEO of the new glory, said that Samsung, Microsoft, Qualcomm, MTK and other suppliers have resumed cooperation with the glory one after another.
There are also media has learned the latest news that the glory and Qualcomm cooperation matters are under negotiation, earlier Qualcomm China CEO even said: Although the glory brand has existed for a long time, but split out of the new glory is a new company, plus the new glory of the members of the new glory itself is the industry, acquaintances together with the cooperation will certainly go smoothly.
Now, after such a long time, Glory will once again launch the Magic series, coupled with the help of Qualcomm, MediaTek, Acuity Brands, and the supply chain such as Songlian, the series is bound to continue to impact the high-end cell phone market.
As for Huawei itself, recently, there is also news that Huawei's Wuhan chip factory has officially obtained the cap and license to supply 4G chips, but over the past year, China's 5G cell phones accounted for more than 50% of the 4G cell phone market has become smaller, which also makes Huawei, even if licensed, the production of the launch of the 4G cell phone products also become meaningless.
A Huawei supply chain listed company executives revealed that Qualcomm has obtained a license to sell 4G chips to Huawei. "(The 4G chip license) was obtained two days ago, and the 5G chip has not yet been licensed."
If the license is really obtained, Huawei's ability to supply 4G cell phones is stable, although not up to the current level of technology, but also much better than no chip available.
Yu Chengdong and Huawei's strategic shift
In 2021, the cell phone industry as a whole probably won't see too many substantial changes, and the competition between cell phone manufacturers will remain fierce, but of course, the impact of Huawei's chip supply being strangled may still be the biggest variable in the cell phone industry.
It's just that for Huawei itself, repositioning itself to open up more new areas may be the best option.
In this case, Huawei chose Yu Chengdong to "carry" the cloud business. His arrival is also the first time that Huawei has changed its core leadership since August 2017, when it established the Cloud BU.
The personnel adjustment is worth noting that, before the responsibility for cloud and computing BG, Yu Chengdong has served as the head of Huawei's consumer BG, intelligent terminals and smart car parts IRB (Investment Review Board) director. This means that the next Yu Chengdong will take over Huawei's cell phone, automotive, cloud computing three major businesses.
"Yu Chengdong to which product line, which product line will become a star, the main product line," a Huawei cloud veteran told told Planet Tech. Huawei seems to be letting Yu Chengdong, who can win the battle, fight from the C end to the B end of the business, not only to compete with Apple in the field of cell phones, tablets and computers, but also in the field of cloud computing and AI to compete with Microsoft and other Internet giants.
Yu Chengdong's speech at the launch of Mate X2 may reveal something: Huawei's strategic plan for the next 5-10 years of full-scene intelligent life "1+8+N", that is, through a cell phone linking PC, tablet and other 8 Huawei terminal products and N Huawei ecological chain products.
In addition, Huawei's new direction is to do hardware services, Hongmeng OS is such a product, Hongmeng OS open to the United States and other manufacturers is to do the basic services, and the early days of Android. Ren Zhengfei also reiterated that Huawei will not broaden the business field, mainly to broaden the use of electronic systems, software computing these systems in different industries.
Ren Zhengfei also recently responded to the Nanniwan project for the first time. In his view, Huawei's "Nanniwan" program that Huawei production self-help, self-sufficiency, including its technology in smelting, smart screen, PC tablet and other areas of breakthroughs, Huawei intends not to rely on the cell phone business can also survive.
Duan Aiguo, president of Huawei's machine vision field, even took the opportunity to show the outside world that Huawei's machine vision has launched a smart pig farming program. Duan Aiguo said, Huawei machine vision to make an effort in the wisdom of pig farming, and the solution has been done, to use the wisdom of the eye to perceive all things, AI enable pig farming intelligent upgrade.
In this way, computers, steel, smart screens, flat panels and other various fields are expected to be included in the Nanniwan project. Smart pig farming involves machine vision, AI and big data analysis and so on may also be part of it.
Then, the significance of the Nanniwan project for Huawei is critical, because it represents Huawei's readiness to cope with all the difficulties and realize technological breakthroughs in many areas. It seems that even if there is a solid technological fortress in front of it, Huawei will do its best to break it.