Is R27k for a smartphone Huawei robbery?

When it launches, Huawei's new Mate 10 Pro Porsche Design will be SA's most expensive smartphone, writes Craig Wilson

20 November 2017 - 11:11 By Craig Wilson
The Huawei Mate 10 Pro Porsche Design, which will cost an eye-watering R27,000 when it goes on sale.
The Huawei Mate 10 Pro Porsche Design, which will cost an eye-watering R27,000 when it goes on sale.
Image: Supplied

Making cheap consumer tech might mean moving more units, but it's not glamourous - and for technology companies, glamour is irresistible.

There's no prestige in affordability or financial pragmatism. No gossip rag reports on the actor who makes it big and keeps driving the jalopy he drove at university but the actor who buys a Lamborghini and bathes in Dom Pérignon? They're the ones teens dress up as for Halloween or follow obsessively on Instagram. Sadly, excess sells. Tragically, it's aspirational.

It's now uncontroversial for smartphone manufacturers to price their fanciest handsets around the R20,000 mark. In typical Apple fashion, the iPhone X reaches and breaches that milestone. But Apple can get away with it, right? Because it's Apple.

The company notoriously has one of the most enviable profit margins on its hardware. Consumers aren't paying extra for better components, they're paying for the Apple marque.

Can the iPhone X do anything no other phone can do aside from costing more? Nope, it can't. When it comes to features in smartphones, there's basically product parity. Sure, LG's second camera is wide while Samsung's, Apple's and OnePlus's is long, but the core features are indistinguishable, as are the prices. What makes people choose one brand over another is subtler.

A little over half decade ago in 2010, Chinese company Huawei, which focused primarily on making network equipment - the dull but essential hardware that makes mobile networks actually work - shifted focus and released a smartphone.

For the next few years pundits would chastise it for making derivative handsets, many of which aped Apple's design choices, albeit at a fraction of the cost.

Derivative or not, the move worked. Initially just another player in the crowded Android market, jostling for position with the likes of Samsung, HTC and ZTE, today Huawei is the third-biggest smartphone manufacturer (behind Apple and Samsung). It's dashed Apple's hopes of dominating the Chinese smartphone market. And the Huawei Group now spends $11-billion on R&D each year.

The jewels in Huawei's mobile crown? The Mate 10 Pro Porsche Design. What sets it apart? It's not the 6GB of RAM (the OnePlus 5 has 8GB), nor the 256GB of storage (you can get that from Apple's iPhone 8, 8 Plus or X), nor the dual cameras (which every big-name brand now offers). It's definitely not the screen resolution, nor the form factor, nor the support for fast charging.

If Huawei's marketing blurb is to be believed, the phone's differentiators are the capabilities of its Kirin 970 chip-set that enables "on-device artificial intelligence", and the cameras having been "co-engineered with Leica". But really, the difference is the inclusion of Porsche's iconic logo, and the price tag.

The Mate 10 Pro Porsche Design will cost an eye-watering R27,000 when it goes on sale in South Africa. That's R9,000 more than the non-Porsche edition. But perhaps more importantly, it's more than the iPhone X, or the Samsung Galaxy Note 8, or the LG V30+.

Huawei can't be expecting to sell many of the devices in South Africa. It didn't even have a unit to show those who attended its South African launch event. But that's not the point. The point is that Huawei can now confidently stake its claim as one of the top three smartphone makers on Earth, with ambitions of unseating those ahead of it.

By making the most expensive smartphone Huawei is making its R&D spend tangible. And it's showing unambiguously that when it comes to the smartphone game, it's playing for keeps. Dismissing its ambition would be as foolish as spending R27,000 on a smartphone.

• This article was originally published in The Times


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