[url=https://www.forbes.com/sites/zakdoffman/2019/05/26/huawei-price-shock-value-of-flagship-1150-p30-proS E N S O Res-crashing-down-to-130/#6b3f17f415a9]Huawei Price Shock: Value Of Flagship $1150 P30 Pro Comes Crashing Down To $130[/url]



"With great design and color options," gushed one reviewer last month, "immense battery life and plenty of power, the P30 Pro isn't just a photography phone, it's arguably the best flagship phone we'll see in 2019."

And it's priced accordingly, at around £900 ($1150) in the U.K., the same price as a Samsung S10+ with equivalent storage.

The phone was launched at the end of Q1, a quarter for which IDC reported that "the only highlight from a vendor perspective was Huawei, which made a strong statement by growing volume and share despite market headwinds... Huawei moved its way into a clear number two spot as the only smartphone vendor at the top of the market... Impressively, the company had year-over-year growth of 50%... Huawei is now within striking distance of Samsung at the top of the global market."

The smartphone market has a vibrant trade-in and resale market, it drives upgrades and growth. In an ideal world, Samsung, Apple and Huawei would like consumers to upgrade annually, trading in last year's devices as they do so. And so the new smartphone market is sustained by its pre-owned resale market. It's the same with cars - if the pre-owned market hits the buffers, it hits new car sales.

On one of the U.K.'s most popular smartphone trade-in sites, that same Samsung S10+, in good condition, can be sold for £510 ($650).

Clearly a steep discount from new, a loss of some 45%, but healthy all the same. On the same site, the Huawei P30 Pro, also in good condition, will now return just £100, less than $130. It has lost almost 90% of its value.

Much has been written this week about software and security upgrades for existing devices, about alternative future Huawei operating systems and app stores, and about the remaining runway on ARM chip designs and SD-card and WiFi licenses. Some analysts have suggested that this gives Huawei time to regroup, to plan, to think.

But it doesn't work that way. Not in a fickle consumer market driven by brand sentiment and advertising.

And this is the short-term issue facing Huawei's consumer business.

Huawei's prior P20 smartphones fare even worse. "Just a few months ago," the U.K.'s Express newspaper reported, "you could have traded in your P20 Pro and received around £280...

Trade-in prices for the P20 Pro are now as low as £50," adding that, "Samsung's 2018 flagship is still worth around £235 which is considerably more than the newer phone from Huawei."

And this is a global issue, even extending to Huawei's home turf in Asia. "The market for used Huawei smartphones has taken a major hit," reported the Straits Times from Singapore.

"While a majority of mobile phone shops here said they are still buying used Huawei handsets, they are offering steeply lower prices for them.

Some shops have stopped buying used Huawei products altogether. Customers, too, are staying away, with sales of used Huawei smartphones dropping sharply."

According to the newspaper, one reseller "has fielded inquiries from four or five sellers despite offering just $100 to buy the Huawei P30 Pro. The recommended retail price for the Huawei P30 Pro is $1,398."

A Huawei spokesperson told me a week ago that the company "Huawei will continue to provide security updates and after sales services to all existing Huawei and Honor smartphone and tablet products covering those have been sold or still in stock globally. We will continue to build a safe and sustainable software ecosystem, in order to provide the best experience for all users globally," adding later that "we are confident this regrettable situation can be resolved and our priority remains to continue to deliver world-class technology and products to our customers around the world."

On Saturday I reported that Beijing has published a cybersecurity public consultation that has aired new regulation that could be used to restrict U.S. technology companies from selling into China. The consultation runs for a month. Huawei is too important to Chian for China to let it fail, and a run on the company's smartphone business would undo years of work and billions in investment. For Huawei, the clock is now ticking. They cannot afford for this to run and run.


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