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Rumor: Huawei Device Ships 16 Mln Handsets in China in 2011

Tencent Tech, 3/30/12

Huawei Device, the terminals subsidiary of Chinese telecom equipment and terminal manufacturer Huawei, shipped approximately 16 mln handsets in mainland China in 2011, according to an industry source, with operator channels accounting for over 60% of sales, although Huawei has yet to officially announce its China shipment figures. Huawei Device China region president Yang Xiaozhong previously said in a media interview that Huawei's mainland China handset shipments would exceed 22 mln units.

Beginning last year Huawei recognized that operator channels were inadequate, and placed significant emphasis on expanding its self-developed and non-operator channels, but with poor results. Huawei senior management announced last year that Huawei Device would build 10 experience stores by the end of 2011, and expand coverage to include 3,000-4,000 retail stores and 5,000-6,000 sales counters. At the time of publication, Tencent Tech had learned from Huawei Device customer service that only three experience stores have been built in Beijing, Shanghai, and Shenzhen.

Last month Yang was transferred out of the mainland China division, and Huawei officially announced he would be placed in charge of Huawei Device's global sales division, while former Huawei Southeast Asia president Wang Weijun would take over as president of the China division, claiming it was part of the company's standard management rotation process. But according to an industry insider, Yang was at odds with other senior managers because he believed that developing e-commerce channels could influence sales of operator-customized handsets, which he directly oversaw, and with lagging sales of Huawei's Honor brand flagship handsets and the afore-mentioned poor sales performance, senior management resolved to make a change in leadership.

Huawei Device was established in 2004 under the stewardship of Eric Xu (Xu Zhijun), who was replaced by Guo Ping at the end of 2005. Guo was then replaced by Chen Chaohui in 2008 according to Huawei's three-year senior management rotation rules. In February 2011, Huawei Device CEO Wan Biao was transferred to the COO position, and Huawei VP and Huawei Device chairman Xu Chengdong currently serves as CEO. Over an eight year period Huawei Device has changed senior executives six times, almost all of whom served for one year with the exception of Guo Ping, and this constant turnover of senior management has made it difficult to maintain the integrity of the company's operations strategy. As a result, the Huawei e-commerce platform launched last week was riddled with flaws, with some handset models unavailable for purchase and priced as high as 35% more than on traditional e-commerce sites.

Under Xu's leadership, Huawei Device shifted to a new development strategy this year with a focus on channel diversification and inclined towards non-operator and e-commerce channels. Xu added that the Ascend P1 handset, unveiled in January, will launch in China this April, with a relatively faster time-to-market than major products released in the past.

Keywords: sales volume HR Guo Ping e-commerce handset retail wireless Huawei Huawei Device Yang Xiaozhong operator-customized Eric Xu Wan Biao

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The information contained in this newsletter is based upon sources that Marbridge Consulting believes to be reliable, and we have made every effort to translate the original articles or article excerpts as faithfully as possible. However, Marbridge Consulting makes no warranty of and assumes no legal responsibility for the accuracy of either the original source material or the English language translations.

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