More Chinese Smartphones Coming to America

Chinese smartphone makers are looking to move further into the U.S. market — aiming to supply low-cost phones to the top U.S. carriers.

Huawei Technologies Co. and ZTE Corp. already sell mobile devices in the U.S., but many of them are basic flip phones and mobile modems or are only for smaller prepaid-phone companies. The companies want that to change.

ZTE says it will quadruple the number of smartphones it ships globally to 12 million this year, including its first model for a top-tier wireless provider in the U.S. Huawei, which already provides a smartphone to the smaller prepaid providers, said it is in talks with the four national carriers.

Huawei’s and ZTE’s push into the U.S. comes at fortuitous time for the companies. Both are known for their ability to supply low-cost products, which have become more crucial as carriers seek to get smartphones in as many hands as possible. As a result, both companies are expecting an expanded presence in the U.S.

Verizon Wireless declined to comment on its handset partners. Spokesmen for the other three carriers weren’t immediately available for comment.

ZTE and Huawei are looking to emulate Taiwan’s HTC Corp., which moved from a quiet supplier of carrier-branded smartphones to a major player in the U.S. market.

The Chinese companies face hurdles in building customer awareness, though, because many of the devices they currently sell only have the carrier’s name.

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The Chinese companies already have fans in MetroPCS Communications Inc. and Leap Wireless International Inc.. Both companies point to Huawei and ZTE as critical to getting affordable phones in the market, which is particularly important in the prepaid segment because there are no subsidies to keep phone prices in check.

Both wireless companies sell the Huawei Ascend, a Google smartphone that has been priced as low as $100 thanks to discounts. MetroPCS Chief Operating Officer Thomas Keys said he was working with both companies to get smartphones that can run on its fourth-generation network at a cost of $200.

(C) Wall Street Journal