Rise of Chinese smartphones threatens Samsung, LG

Rise of Chinese smartphones threatens Samsung, LG

CHINA - Chinese smartphone companies have been growing rapidly in recent years, becoming a threat to Korean handset makers such as Samsung Electronics and LG Electronics.

Chinese companies accounted for more than 20 per cent of the global smartphone market last year, a sharp jump from 8 per cent in 2010, according to global research firm Strategy Analytics.

"Chinese companies' patterns of growth have been quite similar (to each other). They have made handsome profits in their domestic market, invested in gaining a technological edge, and are currently making forays into advanced markets," said Kim Sung-ok, a senior researcher at the Korea Information Society Development Institute.

"As some Chinese smartphone companies begin to expand in the premium markets, competition with Korean companies will be inevitable down the road," Kim added.

Huawei and Lenovo, in particular, have shown outstanding performance in the Chinese market, as they made huge investments in research and development over the past three years.

Huawei, the world's third-largest smartphone maker, following Samsung Electronics and Apple, is looking to boost sales of its premium handsets by spending over 10 per cent of its revenue on R&D, and investing $300 million in global marketing this year.

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