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Telecommunications equipment industry

ZTE Seeks to Capitalize on 3G Momentum with Lightest Handset in Production

Strategic Insights

— 2 min read

China's Shenzhen-based ZTE has unveiled its first 3G handset, the F808, which weighs a mere 104 grams, making it the lightest 3G phone on the market. The company's plans to supply Hutchison 3G UK with third-generation mobile handsets could be a major coup, given the struggles of industry heavyweights Nokia and Motorola to catch up with 3G technology. ZTE aims to increase handset production to 15-18 million units next year, up from 12 million this year, with a focus on targeting low- to high-end markets.

Key Takeaways:

  • ZTE's F808 3G handset is the lightest in production, weighing 104 grams.
  • The company is developing five to six more 3G phones for release next year, targeting low- to high-end markets.
  • ZTE aims to increase handset production to 15-18 million units next year, up from 12 million this year.
  • The company is open to discussion with Hutchison on supplying 3G handsets, which would be its first deal with a Chinese vendor.
  • Rival Huawei Technologies is also developing 3G handsets for release early next year.
  • The F808 phone works on W-CDMA and comes with a built-in rotatable 300,000 pixel camera.
  • Nomura analyst Lily Jap notes that ZTE's strength lies in research and development, not marketing and distribution.
  • ZTE's success will depend on how many operators choose the vendor and its ability to win contracts with major carriers.
  • The mainland company needs 3G for growth, as sales in its traditional handset business are slowing.

Statistics:

  • ZTE aims to increase handset production to 15-18 million units next year.
  • The F808 contains a 300,000 pixel camera.
  • Motorala's A835 3G model weighs 172 grams, while Sony Ericsson's Z1010 is 144 grams.
  • LG's 8120 phone weighs 126 grams.
  • ZTE has manufacturing facilities in the United States, Brazil, and Sweden.
  • The top three handset vendors in the first six months of the year were Motorola, Nokia, and Samsung.

Sources:

  • ZTE press release (exact quote: "We are developing five to six more 3G phones for release next year, targeting low- to high-end markets.")
  • Hutchison spokeswoman (exact quote: "We are open to discussion with more handset vendors worldwide on supplying them with 3G handsets.")
  • Huawei marketing manager Sheng Qiang (exact quote: "The phone will be interoperable with all three 3G standards likely to be available in China: W-CDMA, CDMA 2000 and TD-SCDMA.")
  • Nomura analyst Lily Jap (exact quote: "The strength of equipment vendors [such as] ZTE and Huawei is on research and development, not marketing and distribution.")

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