The old system of 4G mobile phones and the great revolution of 5G mobile phones

New technologies will always destroy the existing order and make everything solid vanish into thin air. It can even be said that technological progress is a "creative destruction process" of "negation of negation".

For the mobile phone industry, 5G is brewing an impending storm. The four-year-long pattern of Xiaomi, Huami, and OV is loosening. The laggards are trying to make a comeback with the help of 5G, while the leaders are taking steady steps.

It's like a long-distance race. People with endurance are ready to release the energy they have accumulated over the past few years at the bend, while people with less endurance are trying to make a lasting effort.

In any case, the old system was about to collapse and the great revolution was coming.

The undercurrent of 4G-5G

Mark Twain mentioned in his novel that history does not simply repeat itself, but it always rhymes the same way.

The changes in the industry landscape from 4G to 5G can be compared to the years from 3G to 4G: Nokia's body was still cold after its fall, and the Chinese mobile phone market had already undergone several rounds of reshuffles. From China Cool Alliance to Xiaomi, Huami, and OV, it was only three to five years.

Although the overall pattern of today's mobile phone market has not changed, as small and medium-sized brands have been eliminated, the battle, especially in the Chinese market, has become increasingly tense and stalemate.

5G is coming, and operators are starting to subsidize again. We can almost foresee that in the next 3-4 years, the mobile phone market will have a subsidy-first half and a post-subsidy second half.

In the first half of the subsidy era, what mobile phone manufacturers need to do is to quickly expand shipments with the help of operator channels and use shipments to educate users.

In the second half of the subsidy era, what mobile phone manufacturers need to do is to stick to technology and products, firmly grasp the downstream channels, and conquer the city with hard power.

Although today's mobile phone market still maintains the pattern of Huami, OPPO and Vivo, this pattern is clearly loosening.

Huawei is the leader and many are strong, followed by OV and Xiaomi at the end.

In this situation, almost all mobile phone manufacturers are rushing to launch 5G. ZTE and Lenovo launched 5G mobile phones early this year, hoping to "gamble big" with 5G. Xiaomi's Lei Jun mentioned at the Wuzhen World Internet Conference that Xiaomi will launch more than 10 5G mobile phones next year, covering high, mid-range and low-end.

For mobile phone manufacturers that are currently lagging behind, 5G is undoubtedly an important bargaining chip. If you put enough chips in, you can often get a chance to turn things around.

Mobile phone manufacturers such as OPPO and vivo, which currently have a relatively stable market position, are adopting an attitude of "holding back their money and watching" or "testing the waters".

OPPO is a typical "wait and see" player. When launching a new phone in October this year, OPPO decided not to launch the OPPO Reno 5G version in the domestic market. In the words of OPPO Vice President Shen Yiren, "When will OPPO launch a 5G phone? This is a matter of choice.

Vivo is testing the waters by launching a mid-range phone with a 5G chip, the Snapdragon 750. It is testing the waters with this phone, which costs around 2,000 yuan.

In the early stages of the 5G market development, a group of young people will definitely come to try it out. Because 5G applications may be AR, VR, or some other novel applications that we have never thought of. Just like the short video and photo social applications back then, only young people are willing to try them. Therefore, holding on to young people is the first step in the 5G competition.

In the words of Honor President Zhao Ming at the World Internet Conference in Wuzhen:

In the 5G era, young people will drag the world forward... Imagination and creativity are more important in the 5G era. There is no doubt that young people will be at the forefront of this era.

Confrontation of technical paths

The impact of 5G technology is likely to be a dimensionality reduction blow to dominant enterprises. Just like when the iPhone replaced Nokia and BlackBerry, the use of different technology paths is likely to trigger a qualitative change in the competition between enterprises.

The so-called dimensionality reduction attack is actually the dimensionality reduction of technology, scenario and channel.

Low-dimensional mobile phone manufacturers sell mobile phones for the sake of selling mobile phones and for the sake of shipments. However, high-dimensional mobile phone manufacturers will regard mobile phones as tools for 5G scene connection.

In the 5G era, competition in the mobile phone market will be a comprehensive contest of comprehensive strengths such as technology, scenarios, and channels.

1. Technology accumulation: 4G-5G must be dominated by technology accumulation. Behind 5G is actually a series of factors such as 5G algorithms, 5G terminal chips, 5G mobile phones, 5G wireless devices, 5G transmission equipment, and 5G core networks. For a 5G mobile phone to be successfully released, every link in the upstream and downstream of the 5G industry chain must be opened up, otherwise the result will be an immature product and delayed release time.

Compared with other domestic mobile phone manufacturers whose core technologies are not self-controlled, Huawei has a complete 5G technology system and understands the operator network. The Kirin 980 chip and Balong 5000 5G solution are completely different from other brands that choose the previous generation of processors + modems to solve 5G problems. This almost determines that when 5G mobile phones are shipped on a large scale, other mobile phone manufacturers may be controlled by others because of one or two environments, but Honor can take the lead.

In fact, Honor already has a very clear roadmap for its new 5G phones - the V series will be the first to be upgraded to 5G, followed by the HONOR series, the X series, and finally the Play series.

2. Scenario reserve: Mr. He mentioned this sentence in the 5G popular science video: speed is actually the most boring application of 5G. In the 4G era, people did not expect the explosion of short videos such as Douyin, nor did they think of the rise of national video live broadcasts. They were even less aware that 4G brought mobile payments, QR codes "killed" cash, and this was even more true for e-commerce and food delivery.

For mobile phone manufacturers, it is necessary to foresee the product scenarios for 5G in advance and make arrangements in advance based on their own advantages. For example, VR, AR products, IOT and smart home, etc. - and this is not something that can be done temporarily. It often needs to be laid out three or four years in advance.

The fruits of tomorrow are all the seeds of yesterday. Huawei started to lay out this plan as early as 2015. Huawei worked with partners on IOT. Huawei has long been clarifying the technical route and strategic choices, and then made standards and agreements based on them, communicating with various platforms and manufacturers to achieve product interconnection and build a system, so that Chinese home appliance brands can be included in the system.

Other manufacturers are more likely to roll up their sleeves and make IOT products to earn profits. This path may work today, but the ecosystem will not be large. With the real entry of 5G, the companies that planted the ecosystem yesterday will harvest the forest tomorrow.

3. Channel landing: As I mentioned in the previous article, channels will definitely become one of the competitive factors of 5G mobile phones. 5G is not only a new technology, but also a whole set of new applications and new scenarios. It is related to AR and VR. Users need to experience it on site to know what it feels like - only in this way can they finally decide whether to place an order.

Honor started offline deployment two years ago, and has been making more and more arrangements at the experience level - this is actually also a layout for VR, AR products and other new 5G applications that cannot be predicted for the time being.

In April this year, Honor's second-stage rocket changed its trajectory and aimed to compete for the top two in the Chinese market. According to Honor's official data, as of April 2019, Honor had built nearly 2,000 offline stores, realizing the evolution and acceleration of offline channels from "retail" to "experience".

Backed by Huawei's large technology platform, Honor has a solid layout in technology accumulation, scenario reserves, and channel implementation, and has the strength and confidence to strike at a lower level. In terms of the young user group, Honor has a natural brand advantage and experience accumulated over a long period of operation.

New shuffle cycle

Stimulated by new technologies, new theories, new business models and new operating methods, companies often consider their competitors, but if they distort their actions simply for the sake of sales or rankings, they will obviously make mistakes.

I have always believed that a company should be itself. If it abandons itself and tries to be someone else, it will often fail in the competition.

OPPO and vivo are cautious in being themselves. Adhering to the strategy of long-term prosperity, OPPO and vivo can often survive the cycle as the second or third place without making big mistakes.

Honor has been targeting young people since 2013, relying on Huawei's backing to be itself. This strategy of snatching young people is also being itself.

Huawei's third quarter report shows that Huawei's smartphone shipments reached 70 million units, higher than the first and second quarters (both 59 million units). This year, it is expected to achieve the shipment target of 240 million units. With the advent of 5G, Honor may further widen the gap with its competitors.

A new technology cycle has arrived. In the three to four years from 4G to 5G, the mobile phone market will be reshuffled again. The subversion of business models and the reshuffle of the market structure make it impossible for mobile phone manufacturers to face a "quiet life".

Austrian poet Rilke said in his poem "Premonition": I recognize the storm and am as excited as the sea. I stretch out and then curl back, I break free of myself and stand alone in the great storm!

5G is like the storm that Rilke talked about, and the companies that had anticipated it have already bravely placed themselves in it.

Who will be eliminated in this battle? We don’t know, we can only observe quietly.