The smartphone industry received game-changing news when it was reported that the global tech giant Google would be severing ties with Chinese Smartphone brand Huawei. The brand has been doing incredible numbers lately with their feature-packed phones that are competitively priced, making it a popular option among lower-income consumers.
International Shipments May Drop as Much as a Quarter
The news deals a significant blow for Huawei and analysts are looking at up to a quarter drop in their international shipping. If things are as bad as they seem, analysts further say that the Chinese brand may disappear from the greater global market altogether. Fubon Research and Strategy Analytics says that if things stay as they are, Huawei’s global product distribution can drop between 4% to 24%.
This is bad considering Huawei just released a new line of mobile devices just a short while back in April. Their P30 has the world buzzing as one of the most advanced and sophisticated mobile devices in the market. Now, given their situation, the hype indeed went the other way, and this could leave Huawei with some dire results.
More than that, there could be another 23% drop next year, according to Linda Sui from Strategy Analytics. She believes the brand may disappear from the western European markets. However, she also believes that the company may survive just with the size of its domestic market. Nonetheless, Huawei was a growing brand on the international market, and losing Google software will likely drag them down.
Google’s Big Moves
Before any of this, Huawei was the second biggest smartphone maker in the world. Not only that but they served as a legitimate alternative to Apple and Samsung. The company would even partner with the likes of Leica to make their built-in cameras more competitive with other phone cameras out there.
All their troubles came from the current tension between the United States and China. The big blow came in the form of The U.S. Commerce Department blocking the Chinese brand from getting goods from America. How the ban works are that goods from America include goods and services with origins 25% or higher originating in the United States. This goes for technology or materials.
This made Google sever its ties with the brand. Soon after Chip designer ARM, which is owned by the Soft Bank group followed suit. That means that products from the company will not be able to receive from updates from Google, nor will they get more supplies from ARM.
What makes Google the prominent driving force behind the decline of Huawei is the Android Operating System and Playstore. Most if not all, smartphones that are not iPhones run on the android. Losing out on future updates is very problematic. Plus there is the matter of losing the play store which has access to all the apps on Google.
Without apps, smartphones are not as fun, useful, or even exciting. This is a huge blow for Huawei. But, it will be interesting to see the supposed OS they have in development.
