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NBD: Lenovo Showed World’s Worst Stock Performance

National Business Daily (NBD), a Chinese national daily newspaper which reports business news, recently reported that the Hong Kong Hang Seng Index announced on May 4 that it would remove Lenovo from its index of constituent stocks. Since Lenovo was included in Hang Seng’s index of constituent stocks in 2013, Lenovo has lost 56 percent of its value. According to Bloomberg, of 171 global technology stocks, Lenovo had the worst stock performance. In the past five years, it appears the Lenovo Group could not manage to sustain a healthy growth in its core business of PC manufacturing as well as the growth of its business of mobile devices. A large number of competitors in China grew at a much faster pace. In 2017, on a global level, the U.S. company HP took back its number one PC manufacturer title from Lenovo. As the Motorola brand owner, Lenovo was China’s number one smartphone vendor in 2014. However, by the end of 2017 Lenovo had only one percent of China’s smartphone market share. Lenovo responded to press inquiries saying the company is entering a new growth era, and Hang Seng’s poor rating will not have a concrete long term negative impact.

Source: National Business Daily, May 5, 2018

China Finance Online: ZTE Issued Internal Memo Disclosing Progress of Recovery Effort

China Finance Online, China’s only online financial information service listed on NASDAQ, recently reported that ZTE issued an internal memo to its staff on the status of its recovery effort after the U.S. government banned American companies from exporting critical supplies to ZTE. The memo said the company was seeking a stay of the U.S. government ban and was “actively communicating” with the U.S. regulators by submitting additional supporting compliance materials. The memo emphasized that, ever since the U.S. ban, “as a globalized enterprise that grew in China,” ZTE has “strictly aligned with China’s national strategy.” The company has been actively taking steps, “firmly under the guidance of the Chinese government,” in order to “resolve the issues quickly.” The memo was issued immediately after the completion of the US-China trade negotiation between high ranking Chinese officials and the U.S delegation in Beijing. Taiwanese high-tech chip maker MediaTek just received clearance from the Taiwanese authorities to resume shipment to ZTE in a few weeks.

Source: China Finance Online, May 5, 2018

Global Times: China Fiber Broadband and 4G Cellular Networks Now the Largest in the World

Global Times recently reported on a recent study of the status of the deployment of global broadband. The study showed that, by the end of first quarter, China’s fiber-based broadband customers held an 85.3 percent share of all landline broadband markets in China. This percentage surpassed previously leading countries Japan and South Korea to make China the number one in the world. The average download speed of overall Chinese landline broadband reached above 20 mbps (megabits per second). This marks a year-over-year growth of 54.9 percent. In addition, China’s 4G cellular network now has around 3.4 million 4G base stations, which makes the Chinese 4G network the largest in the world. China’s 4G market is still expanding rapidly.

Source: Global Times, May 3, 2018

HKET: China Smartphone Market Suffered Largest Quarterly Setback in History

Hong Kong Economic Times (HKET), the leading financial daily in Hong Kong, recently reported that the Mainland’s first quarter smartphone sales suffered a year-over-year decline of 21 percent. Total smartphone handset volume dropped below 100 million to 91 million. This was the lowest point since 2013 and was the biggest quarterly decline in history. With the exception of Huawei and Xiaomi, all smartphone vendors saw a sales decline. Apple iPhone’s sales ranking fell out of the top-four list. At this point, Huawei, Oppo, Vivo and Xiaomi – all are domestic manufacturers – lead China’s smartphone market. The top-four occupy 73 percent of the Chinese Mainland market. Analysts expressed the belief that Apple’s lack of innovation (except for the iPhone X) and high price were the reasons for its loss. In the past two quarters, China’s smartphone market had already suffered a decline. Most of the consumers in the market have completed the conversion from basic phone to smartphone. As the quality and lifespan of a smartphone improve, customers have less of an interest in switching to a handset.

Source: Hong Kong Economic Times, April 27, 2018

Beidou Navigation System Cell Phone Version APP to Launch on May 1

According to an article that Chongqing Economic Times published, the cell phone version of Beidou Navigation APP will be launched on May 1. It is expected to replace the U.S. made GPS (Global Positioning System) and meet worldwide demand by 2020. The Beidou App is reported to have a location accuracy that is within a 1 meter diameter (3.3 feet) compared to the 10 meters (33 feet) that GPS has. China Electronics Technology Group Number 24 research center in the City of Chongqing developed the Beidou Navigation System. The research center collaborates with the Chinese Academy of Sciences Chongqing Green Intelligence Technology Academy and conducts a large quantity of research and development work on satellite surveillance products. The article reported that the Beidou Navigation system has entered into stage III and that 29 satellites have been launched so far. It is expected to reach 50 billion yuan (US $7.92 billion) in production by 2020. Currently GPS has over 90 percent of the market share in the world.

Source: Chongqing Economic Times, April 8, 2018

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