Chinese smartphone brands in big trouble, record drop in demand worldwide – Technology News, Firstpost

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China’s smartphone industry bubble finally seems to have burst both domestically and internationally. Chinese smartphone shipments fell nearly 15% in the second quarter of this fiscal year. According to the Financial Post, a Canadian financial news website, this is the fifth consecutive quarterly loss for the industry.

Several analysts have estimated that the Chinese market is in deep problem and that things will only get worse due to various causes.

India is currently the second largest mobile market in the world, and it will soon overtake China as the largest market for smartphones. However, the Indian market has been dominated by smartphones from Chinese telecom companies, especially in the budget and mid-range categories.

Indian smartphone makers, who took on giants like Samsung and Nokia and dethroned them from the top of the market, have been struggling since companies like Xiaomi and Oppo flooded the market with cheap Android devices.

This is one of the reasons why rumors of the Indian government banning Chinese smartphone makers sell products under Rs 12,000 seemed so plausible.

Several Chinese telecommunications companies have been investigated by the Indian government and have their offices raided in recent months over allegations of money laundering and improper transfer of income and funds from India to their Chinese offices to avoid paying legitimate taxes.

With big companies like Xiaomi, Vivo and Oppo also reporting steep sales declines, this was the fifth consecutive quarter of declining shipments and the second consecutive quarter of double-digit declines.

According to reports, several factors contributed to the decline. The first factor behind the sharp decline in demand is the strict “Zero COVID Policy” that China has adopted. China’s tough COVID-19 restrictions are not good for business. Arbitrary and strictly enforced shutdowns have disrupted local and global retail, logistics and manufacturing industries.

The biggest problem, however, is the fact that the Chinese smartphone market is severely saturated, both domestically and internationally. At the end of last fiscal year, there were more than 1.6 billion active mobile phone accounts in China, surpassing the population of 1.4 billion. This has led to intense competition between brands and market cannibalism within different brands belonging to the same parent company.

The last and perhaps the main reason for the drop in demand for Chinese smartphones is the security issues that several governments and internet activists have had for years now. Several government agencies around the world are concerned that not only the apps but also the devices themselves coming from China could potentially spy on their citizens and are a major concern for national security and sovereignty.

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