Sunday, November 27, 2011

Huawei, ZTE's new multiple choice question: to scale or profit

Xiaofang was to be the size that you want to profit? this is every equipment commercial city in order to face a difficult choice.  Once, Ericsson in front of the problem of tangled, Nokia Siemens Networks also has tangled, and preaches in market strategies to adapt to. today, has always been only "market share" followed the lead of Chinese equipment manufacturers have started thinking about the same problem.  According to Reuters, at an analyst meeting in recent days, Vice President of Huawei solution James Lai said: "the company has already do not need to take down every order, that is the old practices of Huawei, now, Huawei want more profits, so we are not seeking market share after is profit margins, because we already have enough penetration." This is Huawei is very Fake Lancel Handbags rare to corporate strategy stand. revenue and market share has become the world's second-largest after the equipment manufacturers, to breakthrough growth bottlenecks, in addition to expanding the carrier market
Enterprise Fake Lancel Handbags and terminal markets, further improve profitability Huawei, has become one of the important objectives pursued.  However, China two large device commercial one of of zhongxing communications in also of problem Qian, made Fake Lancel Handbags of is different of select. in accordance with the zhongxing President Shi Lirong in Asia moved communications General Assembly Shang of saying, zhongxing hope became global third large device commercial. This is zhongxing of ambitions and dream, from another angle,, this is also zhongxing of crisis, because this is zhongxing "had to" completed of target, otherwise, consequences is grim of.  Over the years, equipment manufacturers in the world ranking, although factors such as Nortel bankruptcy and reorganization of equipment manufacturers, ZTE's market position has been the top five, but can go further on that basis has become a ZTE has been over a ridge. A more realistic scenario is, at present telecommunications market major players only 5: Ericsson, Huawei, Nokia Siemens, Alcatel-Lucent, ZTE, despite a
The first camp, ZTE is a place in the end, this is a "brink" position.  Telecom market attention is, after all, economies of scale, there is not Replica Marc Jacobs enough and the size of share, revenues and profits cannot. last March, for many years head of global markets succeed Yin Yimin Shi lirong as President of ZTE, saying gap no obvious narrowing of the income scale and competitors Replica Marc Jacobs are for handsome incentives, which also determines the Shi lirong, ZTE's strategy in the era of shifting will be significantly.  2010, ZTE of income growth 16.58%, net profit growth 32.22%. to has 2011 years first half, income Replica Marc Jacobs and profit two a indicators this Xiao he long of changes trend obvious. income growth 21.52%, net profit fell 8.62%. may this in Shi lirong, seems, growth also enough fast, he made to 2011 end, ZTE will implementation 30% of growth, is all device commercial in the growth most fast of. Taking into account the Planning Board
Relationship between mold and profit, in the case of revenue growth, ZTE 2011 year profit growth will continue to be optimistic. in the third quarter, ZTE's net profit fell by 21.51%.  Of course, cause profit decline except for size, there is an important factor--its handset business and low profit operation. This is Huawei and ZTE jointly faced a "hot potato".  For both vendors, and rapid expansion of mobile phone business by pulling the entire revenue growth has become the most powerful engine for serious, but the mobile phone business with low margins will drag on profits for the whole company.  ZTE, for example, to the first half of 2011, Terminal ratio of 30% per cent of total income, second only to the operator network 55%, but only 19.8% Terminal sales gross profit margin, below 10%, carrier networks and telecommunications software systems and services. Although Huawei, ZTE has also been proposed by creating
Strategy for high-end phones, but success remains to be seen, at least in quite some time, providing operators with mobile phones is still Huawei and ZTE with great price/performance advantages, also means that the status quo in the short term remains low margins cannot be reversed.  Pattern has basically not much changes in the global market in the context of, access to the world's top three, in addition to outside the enclosure and the layout of the 4G era, can break through the US and European markets is another key factor, which is key to rapidly improve the size and profits within a short time. But the situation is not so optimistic, relative to the earlier layout, Huawei in Europe early flowering, ZTE's expansion in Europe about 3 years too late, now comes as European debt crisis moment. authors understand that the 2010 ZTE market growth in Europe and the 50%, but this year, an increase of only about 30%. United States market, whether it for Huawei, ZTE, in the short term are very difficult to achieve massive breakthrough

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