The economy of scale in the manufacturing of smartphones has driven in China the emergence of smartphones that can be purchased for about $100. This, together with the difference in rates imposed by Chinese carriers depending on whether your contract includes a phone or not, has caused a dramatic increase in the sales of entry-level smartphones, with Chinese manufacturers (with tighter prices) quickly catching up to other brands and phasing out the conventional phones at the same time.
According to a report from TrendForce appeared today, estimated Chinese smartphone shipments will exceed 200M units in 2012, about 30% of the global shipment forecast. Of the Chinese brands, ZTE and Huawei’s combined smartphone shipments will top 65M units in 2012, accounting for 30% of total shipments for Chinese smartphone makers.
As for Lenovo, a brand that just entered the smartphone market since the second quarter of 2012, has shipped more smartphones in the third quarter than ZTE and Huawei combined, now accounting for the 14.7% of the market. Lenovo is now close behind the current market leader in China, Samsung, whose market share is currently at 15.5% (less than 1 point above).
Lenovo strategy is to target consumers in the 700 to 2000 RMB budget, and its success may push other PC manufacturers to enter the smartphone arena and raise the competition.