The struggling Nokia (Helsinki: NOK1V), which once dominated China’s cellphone market, is looking to rekindle excitement there not only with new smartphones using Microsoft’s (Nasdaq: MSFT) Mango operating system, but also a brand new China chief to repair its badly damaged reputation among domestic handset sellers. The company has announced that Gustavo Eichelmann, a 7-year company veteran, will take over at the helm of Nokia’s China operations to try and halt a recent skid in its largest global market. (Chinese article) Not coincidentally, the announcement comes as Nokia made a highly-anticipated unveiling of its first new smartphones using Microsoft’s Mango (English article) — a huge bet for the company as it seeks to regain share in the lucrative smartphone segment where it has become a relative bit player to the likes of Apple (Nasdaq: AAPL), HTC (Taipei: 2498) and Samsung (Seoul: 005930). Eichelmann’s past includes a number of high profile spots, including top management positions in the company’s global sales and channel divisions and head of global customers relations for Vodafone (London: VOD), the world’s biggest mobile carrier. His solid credentials will be sorely needed in China, where Nokia took a beating earlier this year after many of its domestic vendors found themselves with big piles of unsold unpopular handsets forced upon them after years of bullying by the world’s largest cellphone maker. (previous post) The group rebelled at the time, refusing to accept more phones for fear that Nokia’s increasingly unpopular models wouldn’t sell, leaving them with even more inventory. Eichelmann’s strong background in vendor relations should help him to repair his company’s damaged reputation with vendors, especially if the new Mango models are well received and demand is strong. But the company will also have to improve its middle- and lower-end models as well to compete in China’s fiercely competitive market, limiting Eichelmann’s chances for success.

Bottom line: Nokia’s naming of a new China chief with a strong vendor relations skills could help fix  its damaged reputation if can get back in the business of developing popular cellphones.

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◙ Nokia Facing China Backlash After Years of Dominance 诺基亚手机在华“失宠”

◙ Apple on a China Roll, Ambushing Nokia, Lenovo 苹果伏击诺基亚和联想 在华发展势如破竹

◙ Guest Post: Move Over Nokia and RIM, Here Comes HTC

Huawei Technologies has given some of its first formal remarks since the latest rejection in its drive to enter the US, saying it will rely on innovation to finally break into this difficult market. The remarks, which came from one of the company’s top US officials late last week, sound neutral enough in theory, but really doesn’t do anything to address the main US concerns over security that have thwarted Huawei in the market so far. (English article; Chinese article) I do have to credit the official, a man named John Roese, with at least modifying Huawei’s previous style that was more direct and even slightly confrontational. A couple of weeks ago, the company was informed by the US telecoms regulator that it wouldn’t be allowed to bid for contracts to build government-operated emergency broadband networks, an outcome that surprised no one, and then made the situation worse by asking for an explanation. (previous post)  At least the company finally is letting someone who appears to be an American citizen be its spokesman, and it’s clear that he’s avoiding the sensitive topic of national security, which is the main reason for Huawei’s lack of progress in the market today. But for the company to ultimately succeed in the US, it will have to tackle this tough issue of security by demonstrating that it’s not an arm of the Chinese government, and that its products won’t be used for spying by Beijing. Roese’s “innovation” argument won’t do anything to address any of these concerns, but at least he’s showing that the company will probably take a more low-key approach to the situation in the future, which is needed in such a highly sensitive matter. I would look for the volume of behind-the-scenes communication between Huawei and US government officials to pick up considerably as part of this effort, though the company is unlikely to make any significant progress until after next year’s presidential elections in November.

Bottom line: Huawei is making a smart move by toning down its high-profile approach to enter the US, but is unlikely to gain access to the market until 2013 at the earliest.

Related postings 相关文章:

◙ Huawei Undermines US Push With Foolish Request 华为讨要说法很不明智唯有阻碍进军美国市场

◙ Huawei, Lenovo Look to Foreign Advisors in Westward Drive

◙ Rongyao’s US Lawsuit Spotlights China’s Lack of PR Savy *荣耀高调起诉辉瑞 彰显公司缺乏公关意识

China Mobile (HKEx: 941; NYSE: CHL) continues to struggle under the uninspired leadership of outgoing Chairman Wang Jianzhou, with third-quarter profit growth slowing to 3.7 percent, or about half the second quarter’s rate of 7 percent. (English article) I’m probably being too tough on Wang, as clearly fierce competition for 3G subscribers with rivals China Unicom (HKEx: 762; NYSE: CHU) and China Telecom (HKEx: 728; NYSE: CHA) is the main reason for the profit slowdown. In fact, China Mobile has boosted its 3G subscriber campaign considerably in the last few months, as more phones and other devices that can run on its homegrown technology come to market. But while Wang should be commended for finally using China Mobile’s dominant market position to promote 3G, he continues to provide uninspired leadership that simply sees the new standard as a way to power cooler-looking smartphones, many of them low-cost models made by the likes of ZTE (HKEx: 763; Shenzhen: 000063) and Huawei. Instead of focusing on this lower end of the market, Wang and China Mobile should be chasing higher-end subscribers who use 3G for its powerful data transferring speeds to enable a wide range of mobile Internet applications, which provide much fatter profit margins. Instead, most of my friends here in Shanghai still overwhelmingly use 3G services from Unicom and China Mobile for their wireless web surfing, even though most complain of spotty coverage: a shortcoming that China Mobile could easily exploit to steal some of these more lucrative subscribers. It looked for a while like China Mobile might get some help at the high end with the roll-out of a 3G iPhone from Apple (Nasdaq: AAPL) for its service, but suddenly that initiative seems to have gone quiet. (previous post) As I’ve said before, Wang was an OK leader for his time, helping China Mobile consolidate its position as the country’s dominant mobile carrier during his 5 or 6 years as chairman. But he really needs to step down soon, a development that looks likely, and hand over the company to younger new leadership that really understand where the mobile world is heading.

Bottom line: China Mobile’s uninspired third-quarter results are largely a result of its poor approach to the 3G market.

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◙ China Mobile: Where’s the 3G iPhone? 中移动4G网络稳步推进 3G版iPhone或遇阻

◙ China Mobile Shuffle: Sea Change Coming? 中移动高层变动或引发重大变化？

◙ TD-LTE Hits First Delay, More to Come? TD-LTE技术首次延期 未来还会更多？