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Samsung Electronics Seeking to Absorb Huawei Customers
A Chance to Expand Market Share
Samsung Electronics Seeking to Absorb Huawei Customers
  • By Kim Eun-jin
  • May 28, 2019, 09:40
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Samsung Electronics’ promotional advertisement in Singapore

As Google Inc. has suspended Huawei Technologies Co.’s access to its Android operating system (OS) services, Samsung Electronics Co. is moving to benefit from it. The South Korean electronics giant has recently launched promotional activities in Singapore to absorb Huawei smartphone users.

If Google cuts off support to Huawei for its Android hardware and software services, Huawei smartphone users will not be able to use Google Play Store and other main services, such as YouTube and Gmail. The Google OS is being used in 75 percent of smartphones around the world. Accordingly, there is growing concern among Huawei smartphone users.

Samsung Electronics Singapore has launched an offer for Huawei customers on May 27. It announced discounts of up to SG$755 (US$550 or 650,000 won) to customers who trade in their Huawei smartphones for a Galaxy S10 device until May 31. Under this campaign, Samsung offers an additional trade-in value of SG$755 (US$550 or 650,000 won) on the Huawei Mate 20 Pro, SG$560 (US$410 or 480,000 won) on the P20 Pro, SG$545 (US$400 or 470,000 won) on the Mate 20, SD$445 (US$325 or 380,000 won) on the P20 and SG$300 (US$220 or 260,000 won) on the Nova 3i model. With Google’s latest breakup with Huawei, an increasing number of Huawei customers are expected to choose the Galaxy S10.

Mobile carriers in many countries have also postponed launches of upcoming Huawei smartphones over concerns the devices will lose software support. As the U.S. Commerce Department granted Google a 90-day extension to continue to work with Huawei, Huawei smartphone users are likely to be banned from updating the Google OS starting from Aug. 19. Accordingly, two British carriers, EE and Vodafone, said they would not offer Huawei phones to customers. Two of Japan’s largest mobile carriers, KDDI Corp. and SoftBank Corp., also said they would delay the debut of a new smartphone by Huawei. Another major mobile carrier, NTT Docomo Inc., said that it would stop taking orders for the new Huawei handsets.

Business Insider, an American financial and business news website published by Insider Inc., recently reported, “If Huawei sees a dip in smartphone sales as a result of the U.S. government placing the firm on a trade blacklist, rivals like Apple and Xiaomi would still have a lot of catching up to do in order to endanger Samsung's spot at the top.”

With the U.S. government asking its allies to break off business relations with Huawei, the Chinese mobile producer will be isolated in the telecom equipment market. On the other hand, Samsung Electronics is forecast to gain more benefits if the U.S. extends sanctions against Huawei. Market research firm IHS Markit said that Huawei has a 31 percent share of the global telecom equipment market last year, while Samsung Electronics has a 5 percent share..

Meanwhile, global rating agency Fitch Ratings said that the U.S. sanctions against the Chinese telecom equipment manufacturer would be an opportunity for Samsung Electronics to strengthen its position in the smartphone market.

Fitch said on May 27, “The loss of access to Google's Android operating system would significantly hurt Huawei’s smartphone sales outside China, thereby giving Samsung Electronics a chance to improve its market share in Europe, Asia except for China, and South America, the regions in where Huawei has recently shown growth.”