Meizu's layoffs spark a major reshuffle? LeEco, Lenovo, and TCL's mobile phone businesses are also in trouble

There is a good news or a bad news. Which one do you want to hear? Let me tell you the bad news first: an insider of Meizu revealed that Meizu has recently started a large-scale layoff. Not only did the employees lose their jobs, but the company also encountered turmoil, and the entire mobile phone industry will usher in a brutal reshuffle. The good news is that for consumers, there is no need to worry about buying a mobile phone anymore. A few big brands are enough.

According to IDC's data on China's smartphone shipments in 2016, OPPO, Huawei, and vivo accounted for more than 43% of the market share, ranking the top three, while Xiaomi, regarded as the originator of Internet phones, fell 36% year-on-year, with its market share shrinking to 8.9%. This indicates a reshuffle in the mobile phone industry, a major concentration of brands, and the beginning of delisting.

In 2017, Meizu once again started with layoffs.

This is the second time in the past two years that Meizu has been reported to have laid off employees. In early 2016, Meizu announced that it was laying off employees, but the layoff ratio did not exceed 5%, and the laid-off employees were provided with double salary and severance compensation at the end of the year, so that the outside world did not have too many responsibilities for Meizu's layoffs. However, the recent layoffs are on a larger scale. According to the number of Meizu employees on DingTalk, the company's internal communication and office platform, there were about 4,400 people at the beginning of the year. As of March 24, the number has become more than 4,000, a decrease of about 10%.

Last year, Meizu was very successful. More than a dozen press conferences attracted a lot of attention and made the media excited. The sales volume exceeded 20 million units. However, Meizu's losses were staggering. Some media reported that in the year and a half before October last year, Meizu's total losses exceeded 1.3 billion. Under the huge losses, it is unknown how long Meizu, which has insufficient hematopoietic ability, can persist. From this point of view, this "low-key" layoff is due to problems with Meizu's capital chain. For Meizu, whose mobile phone competition is still driven by burning money, this is a dangerous signal.

TCL Communication is the first to fall behind in the Chinese market

In November 2016, media reported that TCL's mobile phone business encountered difficulties in the process of brand transformation and may lay off employees in the near future. An insider of TCL Communication mentioned that "the number of people leaving is also related to their personal choices." The business optimization in China this time is another in-depth adjustment after the reorganization of the mobile phone business in April. In addition, TCL Communication has been delisted from the Hong Kong stock market, which also makes the outside world see TCL's helplessness in indirectly giving up the Chinese market.

In the first half of last year, Yang Zhe, then global COO and president of China of TCL Communication Group, said that TCL mobile phones would be transformed in all aspects, including products, prices, channels, and brands, to enhance the competitiveness of TCL communication products in the Chinese market. However, according to data from the domestic smartphone market in the first half of 2016 released by research firm IHS Technology, TCL ranked 20th with sales of more than 1.33 million units, which is negligible compared to Huawei and OPPO.

According to data released by TCL Group, the cumulative sales of smartphones in the first 10 months of 2016 reached 31.63 million units. Among them, the sales of smartphones in October were 3.913 million units, 93% of which came from overseas markets, which also shows that TCL mobile phones have almost lost the domestic market.

The general situation is over, and changing the leader seems to be a common routine for companies to report to the outside world. On February 17, 2017, the CEO office of TCL Communication issued an email stating that the board of directors of TCL Communication agreed to Yang Zhe's resignation as the chief operating officer of TCL Communication and president of the China Marketing Department, and he will no longer serve as a director of TCL Communication and a member of the Operations Executive Committee. Looking back, Yang Zhe once boasted that TCL mobile phones could not simply survive, and in addition to facing the immediate survival, they must also have poetry and distant futures. Obviously, poetry and distant futures no longer belong to TCL mobile phones in the Chinese market.

LeEco's mobile phone business is no longer as crazy as it was last year

Since the second half of last year, LeEco has fallen into the pit of capital. Jia Yueting asked his classmates and fellow villagers for emergency assistance of 16.8 billion yuan, but it is not enough at present. Last year, due to supply chain problems, the shipment volume of LeEco's mobile phone business dropped sharply. Jia Yueting published the content of "Half Sea Water, Half Flame", exposing various problems of LeEco, adjusting the business strategy, and having to urgently call for funds to alleviate the supply chain problem. It also caused a rift between Jia Yueting and Lei Jun, which was very unpleasant.

Recently, a media interviewed Coolpad CEO Liu Jiangfeng, who mentioned the impact of LeEco's financial crisis on Coolpad. Liu Jiangfeng quickly denied that there was a deep impact, and directly replied that LeEco was only a shareholder of Coolpad and would not affect Coolpad's mobile phone business. In the future, mobile phones will introduce artificial intelligence technology, and he was not convenient to comment on other things. It can be seen that Coolpad does not want to be associated with the word LeEco, but after all, LeEco is still a major shareholder of Coolpad, and it is unlikely that it will not be affected at all.

Lenovo's mobile phone business continues to struggle, ready to start over

Lenovo is the most volatile domestic mobile phone brand. Lenovo still has differences on whether to keep or go with the Motorola brand. Alexey Klochkov, executive director of Lenovo Eastern Europe Mobile Division, said that Lenovo has decided not to launch smartphones under the Motorola and Vibe brands, and all phones will be sold under the Lenovo Moto brand. Aymar de Lencquesaing, chairman and president of Motorola Management Board, said recently: "Lenovo will not give up the Motorola brand. It (Motorola) will continue to be used. Now we know better than ever how to present the brand."

Lenovo's mobile phone brand has been up and down, and it seems to have no other redeeming features except for increasing traffic and presence. To date, there is still no clear conclusion on how Lenovo's brand is. The outside world judges that Lenovo's mobile phone business brand only has Moto left, and the senior management has been frequently replaced. After the mobile phone department introduced Samsung Electronics executive Jiang Zhen, China Mobile executive Yu Gao and China Telecom mobile phone sales operator Zhu Han, Lenovo Group will welcome its fourth executive on March 6 - Ma Daojie, former general manager of China Telecom Terminal Company, with the intention of starting over.

Back in 2015, the top five smartphone manufacturers in the world were Samsung, Apple, Huawei, Lenovo, and Xiaomi. In 2016, Lenovo and Xiaomi were squeezed out of the top five, replaced by OPPO and vivo. In 2014, Lenovo Group was the world's third largest mobile phone manufacturer in terms of mobile phone shipments. It is puzzling that Lenovo's mobile phone business has experienced such a setback in just two years.

Price hikes accelerate reshuffle of mobile phone brands

Just like the TV industry in the second half of 2016, this year’s mobile phone price increase is inevitable. In February this year, on the afternoon when Xiaomi announced a 100 yuan price increase for its Redmi series, the CEO of OnePlus posted a Weibo post: “The main theme of the mobile phone industry in 2017 is price increases.”

On February 16, Nubia announced that it would raise the price of Nubia mini S by RMB 100, becoming another mobile phone manufacturer to temporarily raise prices after Xiaomi and Meizu. The reasons given for the price increase are clear: the increase in component procurement costs and the impact of exchange rate factors. The main chipset, display and touch module, front and rear lenses, ROM/RAM are the main components of the mobile phone cost structure, accounting for 50%-70% of the total cost. Computer accessories such as memory, SSD, CPU, etc. have also increased in price, and the price increase is reasonable.

Although Huawei and Xiaomi are increasing their chip research and development, and companies such as BOE are focusing on mobile phone screens, Chinese mobile phone companies still have a long way to go in terms of localizing components. Constrained by the supply chain and consumers' deepening demands for consumption upgrades, the price wars of most mobile phone brands are no longer effective. This is a fatal blow to niche brand mobile phones. It indicates that the era of exchanging price for time and space is over. The entire mobile phone market has changed. The best era for smartphones has passed. In the next few years, there will be no more "black swan" events in the mobile phone industry.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.