China Mobile to expand the scope of subsidies conceal the handset industry chain embarrassment

Li Na

Market came out yesterday, China Mobile has subsidized the object from the original five-mode to three models. In fact, behind this practice conceal the handset industry chain embarrassment.

Taiwan research institute DIGITIMES Research released a research report yesterday, said that due to the high 3G stocks, 4G supply chain can not afford the reason, most mobile phone manufacturers on the third quarter before the pessimistic of shipments. Although e-commerce can digest some of the 3G inventory, but the total amount is still insignificant. Chip industry insiders told the "First Financial Daily" that China Mobile is no longer "love" in the five models, representing more choices mobile phone manufacturers, to a certain extent, boost 4G mobile phone sales.

The insiders pointed out that 4G supply chain and the market has not yet fully mature, 3G stocks and shuffling sounding heart, in the current 4G heat wave, most domestic manufacturers are experiencing a strike or wait for the game.

4G heavy volume in the first half

However, at the GSM Asia Mobile Communications Expo held in Shanghai earlier, China Mobile publicly disclosed that the five models are the direction and technology route for China Mobile. In particular, roaming and high-end subscribers are considered Demand, so China Mobile must do. However, three-mode have a certain market demand, but also the direction of development of China Mobile.

"Mainly based on the needs of the market to provide in the end is to provide three or five mode.We hope to provide more 4G middle and low, to meet the needs of the masses of cheap and costly terminals." Li Yue, president of China Mobile said.

Compared to the previous tough, the move of the foreign position will undoubtedly make the industrial chain up and down relieved.

Earlier, China Mobile updated its TD white paper on customized end products. In the new TD customized terminal white paper, China Mobile requires that the first round of LTE handsets be capable of supporting five modes (TD-LTE / TD-SCDMA / GSM / WCDMA) since May 31, 2014 Emphasize that LTE handsets must support TDD / FDD simultaneously. This news came out, there are many people in the industry comment 4G mobile terminal is too radical. China Mobile's tailor-made requirements for TD-LTE terminals will bring tremendous pressure to the terminal handset manufacturers, which will affect the steady development of the domestic handset industry and the chip industry.

This is mainly because, on the one hand to provide five-mode chip manufacturers only Qualcomm (79.19,0.03,0.04%), the terminal manufacturers is not strong, on the other hand, even if the terminal manufacturers choose Qualcomm chips, but the cost Not down, is not conducive to the large-scale development of China Mobile 4G.

In fact, this symptom has already appeared in the first half of the year.

According to the latest figures disclosed by Li Yue at the GTI Asia Conference, China Mobile's 4G customer base reached 6.5 million, which is only 13% less than the 50 million subscribers set by China Mobile in the whole year.

4G market is difficult to start the biggest reason is that 4G network construction progress, coverage, tariff levels, have not yet reached the heavy volume requirements. In the mobile phone chip, MediaTek 4G chip to be put into commercial until the second half of this year, the first half of the available suppliers only Qualcomm, Marvell.

"By the first half of 4G models have not yet been universal drag on the mainland smart phone market in 2014 could hardly break the scale of 400 million hurdles." DIGITIMES Research Assistant Analyst Chen Chun Yi told reporters that because the initial 4G high tariffs, poor communication quality , And low-cost smartphones that support 4G communication standards are not rapidly gaining popularity, reducing the willingness of mobile subscribers to upgrade to 4G.

Short-term profitability is still difficult to improve

In fact, although not yet the amount of 4G, but many domestic manufacturers have chosen a different way to enter, a mobile phone manufacturer in charge of a reporter pointed out that in 3G switched 4G runway, for mobile phone manufacturers need to be wary of the "spot" Into "the risk of inventory.

"Although there are several handset manufacturers in the single-quarter shipments still maintain the level of more than 10 million units, but from the actual market conditions, the second half of the second quarter of this year, upstream supply chain shipments began to turn cold." Chen Chun Yi said one of the important The reason is that due to the relatively close cooperation with telecom operators handset manufacturers, purchase subsidies and subsidies to reduce subsidies to the impact of 4G models, 3G handsets inventory level increased.

The domestic mobile phone manufacturers said to reporters that since the first half of China Mobile 4G customized terminal strategy was swinging between three modes and five modes, which also increased uncertainty for mobile phone manufacturers in new product R & D and supply chain.

At the same time as FDD license has not been issued, China Telecom and China Unicom specific 4G custom terminal requirements are also outstanding, many choose the "conservative" line of mobile phone manufacturers are more focused on 3G manufacturing and shipping, which led directly to The stock problem.

"A slow-moving handset could swallow the profit of selling 13-15 mobile phones." Ai Yi Consulting CEO Zhang Yi told reporters that in accordance with the current handset manufacturers 10% to 15% of the gross profit margin level, supply chain management and inventory control Etc., made high demands on the operation of the enterprise.

On the other hand, gamble 4G is still at risk for the more radical manufacturers.

Cool to their goal is set, in fiscal year 2014, sales of 60 million mobile phones, of which 4G mobile phones to reach 40 million. Insiders pointed out that the gamble 4G approach is debatable, on the one hand, ahead of seize the market does have some opportunities, similar products can be a morning or two in the morning, but this time difference is not significant, we will soon be able to keep up; On the other hand, 4G has not exploded at the retail level of the market, which may result in a large number of 4G mobile phones being put on the channel. Slight inadvertently causes inventory risk and supply chain risk.

In addition, Chen Chun Yi told reporters that although the 12th quarter of the new electricity supplier category to promote the mainland smart phone supply chain peaked in April to achieve results, but most of the cost-effective models are the lack of differentiation of the 3G standard, Only to lower prices compete with each other, product sales cycle significantly shortened.

"The contribution of e-commerce to profits is not high." Cool vice president Cao Jingsheng admitted to reporters.

However, he believes that the phone has reached the reshuffle of the entire industry, some similar to the previous major domestic reshuffle of PC and home appliance stage, the end is only a handful of the market to survive, the formation of the industry giant, the profit was restored to normal s level. At present, the domestic mobile phone industry is generally in the gross profit margin of 15% to 20% level, the industry profitability in the short term will not significantly increase.

"For the mobile phone industry, relying on large-scale hardware manufacturing to get high profits has gone forever.Micro-profit hardware for Chinese enterprises to global competition is a good opportunity, but must also seek to high-end mobile phones and global The brand will survive in the final market competition. "Cao Jing Sheng said.

DIGITIMES Research believes that with the gradual consumption of old 3G models in the third quarter, more 4G new machines below RMB1,000 will be launched in July in succession, hoping to drive the shipping in the domestic market in the second half of the year.