ZTE targets LG’s top three spot


Chinese handset manufacturer ZTE predicts it will be the third largest handset manufacturer by shipments within four years, behind only Nokia and Samsung.

ZTE is already closing on fifth place, a position held by Motorola at present. According to market researcher iSuppli, ZTE took four per cent of global share in the fourth quarter of 2009 with handset shipments of 13.4 million units.

Motorola sold 12 million handsets in the fourth quarter of 2009, according to analyst IDC. In fourth, Sony Ericsson sold 14.6 million.

ZTE sold 36.5 million units in 2009 in full, according to iSuppli. ZTE itself claimed sales of 40 million handsets in the year. Both figures put it at number seven, behind Nokia, Samsung, LG, Motorola, Sony Ericsson and Research in Motion.

But ZTE is demonstrating considerable success in its home market, which takes around 30 per cent of its sales currently. It is also recording good sales volumes in developing markets, notably Brazil, India and Russia.

Some incremental business has come from Europe as well, where it has now struck supply relationships with eight of the 10 leading operators.

It expects to shift 80 million terminals in 2010, including sales of data cards, which comprised one third of its terminal sales in 2009, a 20 per cent jump on 2008. It has set itself a target of 100 million handsets and data cards in 2011, and expects to outpace LG in third in terms of handset shipments alone by 2015.

Zhang Xiaohong (pictured), vice president of ZTE’s handset product system business, said ZTE will increase sales in the UK and mainland European markets by production of operator-branded and co-branded handsets.

Xiaohong said ZTE will build customer relationships in the UK with its swift production line and ability to customise devices to operator requirements.

Xiaohong said: “In the past years, we have grown sales at a steady rate. Our ability to customise devices makes us a good partner for operators looking to differentiate themselves in certain market segments. Our after-sales support for partners is also excellent. Our infrastructure work makes us very familiar to them already as well, and gives us experience of systems and core technology.

“We will continue to release devices under operator-brands in Europe, and will increase the number of products on which we share some branding. Own-branded devices will come further down the line.”

ZTE will work with a number of operating systems, including Google Android and Windows Mobile. Xiaohong said ZTE will release five Android handsets for European and international markets, including forthcoming ‘Blade’ and ‘Racer’ handsets.

Of its plans for releases to run on the Windows Phone 7 series platform, she said: “We will work according to Microsoft’s agenda to release our products.”

ZTE said net profit was up 39.68 per cent to RMB109.86 million (US$16.09m) in the quarter to March 31, 2010.

Revenue was up 13.59 per cent to RMB13.26 billion ($1.94bn) compared with the same period last year.

ZTE said some growth came as certain “equipment manufacturers left the mainstream market”. It said “outstanding results” for sales of handsets, data cards and network hardware lifted revenue and profits.

It said sales of handsets and data cards were up 41.8 per cent year-on-year. Revenue from telecommunications software systems, services and other products grew by 40.8 per cent, it said.