Chinese smartphone maker Xiaomi Corp is selling its newly launched Mi 2S model in Hong Kong and Taiwan in a bid to extend its reach beyond mainland China. The handset is equipped with a quad-core Snapdragon 600 chipset developed by Qualcomm, and runs on Xiaomi’s latest operating system Miui V5. Xiaomi prepared 200,000 units for the first round of sales. Xiaomi also unveiled the Mi 2A – a version of the Mi 2S targeted at younger consumers, such as college students, priced at CNY1,499. Xiaomi, which posted CNY12.7 billion in revenue in 2012, sold 7.19 million smartphones last year and hopes to double the sales figure to 15 million units this year. It launched its first smartphones in August 2011. In addition to Hong Kong and Taiwan, some emerging markets, including Russia, India and Brazil, will also be targeted.

ZTE Corp, which has already sold 500 million phones globally, expects mobile phone revenue to contribute up to half of its total income by 2015 from an expected 30% this year, thanks to surging smartphone sales, overseas expansion and 4G opportunities. ZTE is banking on mobile phones to help diversify business and overcome weaker demand for telecom equipment which drove the Shenzhen-listed firm into its first annual loss of CNY2.84 billion in 2012 since being listed in 1997. Its revenue fell 2.4% to CNY84.2 billion. Last year, ZTE sold CNY25.8 billion of mobile phones and the firm expects sales to grow 30% this year. “Mobile phones have become our strategic business, especially smartphones,” Hou Weigui, ZTE’s Chairman, said at an event to mark the firm’s 15th year of selling mobile phones. This year, ZTE plans to sell 45 million to 50 million smartphones, up from 35 million units last year. It plans to sell high-end phones costing over CNY2,000 and also test the market for phones priced over CNY3,000, where Apple and Samsung dominate, He Shiyou, ZTE’s Executive Vice President, said. In 2012, ZTE sold 65 million phones globally, taking up a 3.8% market share to rank No 4, according to International Data Corp (IDC). Overseas sales account for 60% of ZTE’s total revenue. Chairman Hou Weigui expects the company to return to profit growth this year. He forecast revenue growth will average 10% annually over the next five years. Hou said he expects network infrastructure spending by European telecom operators to gradually pick up, and demand from carriers in Asia and Africa to also gain momentum. The issuance of 4G licenses in China would also be a boost for ZTE’s business. China Mobile announced its capital spending would jump 49% year-on-year to CNY190.2 billion in 2013. More than half of the company’s spending on networks will go on 4G projects this year. Last year was a tough year for Shenzhen-based ZTE, as it posted its worst annual financial report in 15 years.

China Wireless Technologies, China’s third-largest smartphone vendor, believes demand for low-cost phones will help it eventually overtake market leaders Samsung Electronics and Lenovo. A 50% surge in smartphone shipments will allow China Wireless to pass Lenovo for the No 2 spot this year, though catching Samsung will take longer, Chief Financial Officer Jiang Chao said. “Lenovo’s share is only 2% higher than our company’s, so we will catch up to them very fast,” Jiang said in Shenzhen. China Wireless surged to third place in the smartphone market in the three months to September, up from sixth in the preceding quarter, according to IDC. For 2012, Samsung led China’s smartphone market with a 17% share, against 11% for Lenovo. China Wireless did not rank among the top five for the full year. Smartphone shipments in China will rise 44% to 300 million units this year, driven by handsets costing about CNY700, IDC forecast in December. Demand is surging as China Mobile aggressively encourages users of second-generation networks to upgrade to third-generation services with low and middle-end smartphones. China Wireless, formed in 1993, has sold phones through China Mobile for a decade. Yuji Fung, Hong Kong-based Analyst with Oriental Patron Financial, said that strong smartphone growth was driven by the operator channel via handset subsidies. China Wireless will boost smartphone shipments to 30 million units this year, and 40 million units next year, from more than 20 million units last year, Jiang said. Samsung shipped 37.1 million smartphones in China last year and Lenovo 23.5 million, according to IDC.

Huawei Technologies has won an injunction from a court in Germany against ZTE, which is now barred from selling its 4G-ready LTE base stations in that market, but Hong Kong-listed ZTE said it would appeal against the decision of the Mannheim Regional Court to a higher court. ZTE said it was “confident the product involved in the lawsuit doesn’t infringe Huawei’s patent rights”, adding that the court’s decision would not affect its business operations worldwide. Huawei, which is privately held, brought lawsuits in Germany, France and Hungary against ZTE in April 2011, mainly for alleged infringements of its rights over a patent on the “key derivation function”, which represents a “standard-essential patent” for the 4G mobile technology long term evolution (LTE). ZTE filed a countersuit in China later that month, alleging that Huawei had violated ZTE’s 4G LTE patents and should pay unspecified compensation. The same court, however, cleared ZTE over patent-infringement allegations related to USB modems that are attached to laptop computers “because these were not deemed to implement the patented invention to a degree that would have warranted a sales ban”. ZTE said it was “ready to settle any intellectual property right issues through negotiations”.

China’s Huawei Technologies has won a contract to build the 4G mobile network infrastructure for New Zealand’s biggest telecommunications company, expanding its presence in the country after receiving the cold shoulder in neighboring Australia. Telecom New Zealand said the network will go live in Auckland, the country’s biggest city, in October, and extend coverage to Wellington and Christchurch by Christmas. Huawei has also built the mobile network for 2degrees, while Vodafone uses Huawei equipment in its fixed-line network in the country. While Huawei accounts for around 70% of the world’s 4G deployment, it was barred from bidding for a contract to build Australia’s national broadband network, after the Australian government cited cyber-security concerns. Industry experts said the Telecom New Zealand contract indicated that New Zealand did not share the same security concerns. Huawei has increased sales and gained market share in Europe, Africa and Asia, muscling in on rivals such as Alcatel-Lucent by offering lower prices, but it has run into obstacles in countries including Australia and the United States, where it is not allowed to sell telecommunications equipment to domestic carriers. It also faces exclusion from Canada’s government broadband network. Huawei has repeatedly said that it has no links with the Chinese government, and that it does not believe U.S. security concerns will have an impact on decisions by other countries to use its technology. Telecom New Zealand said that it had selected Huawei because of its global dominance in network development. “Huawei’s selection was based on two main factors. The first is that they have extensive experience, having built 73 LTE networks in 42 countries,” David Havercroft, Telecom New Zealand’s Chief Technology Officer, said in a statement. “The second is that they are truly pushing the boundaries of LTE technology.”

Separately, Huawei said it has completed the world’s first advanced LTE active antenna system on trial for Deutsche Telekom in Germany. Huawei Technologies targets a 10% compound annual growth over the next five years by increasing its smartphone and cloud computing sales. Guo Ping, Huawei’s Co-CEO expects Huawei’s network equipment sales to tumble to 60% of the company’s sales by 2017 from 73% last year after the Shenzhen-based privately-held firm drew cyber security concerns from foreign governments including the U.S. and Australia. Huawei’s sales rose 8% to CNY220.2 billion last year while net profit surged 32% to CNY15.4 billion. Huawei’s sales in China rose 12.2% to CNY73.6 billion, or a third of the total. Huawei’s founder Ren Zhengfei attributed its performance during the past 25 years to “gaining might from a small hole”, explaining that water under high pressure can be spurted from a small hole to cut steel plate. Huawei and its 150,000 employees, he said, pursue the duel target of focusing on customers and lifting competitiveness. Huawei entered the world’s top three of smartphone makers for the first time in the fourth quarter of last year. It shipped 32 million smartphones in 2012, a 60% year-on-year increase.