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ZTE aiming to triple revenue in next three years

Leading telecommunications company ZTE (Thailand) aims to more than triple its revenue to US$1 billion (Bt32 billion) within the next three years.

Last year it had revenue of $300 million.

ZTE managing director Nick Wang said that over the next three years the company aimed to post a total revenue figure of between $3.5 billion and $4 billion from the nine Asean countries it operates in.

Wang said that ZTE's performance in Thailand - its biggest market in terms of revenue - had improved dramatically over the past 10 years.

He said the company had big sales of marketing and sales in wireless (3G and 4G/LTE), optical (fibre), and terminal (smartphones). It expected each business unit to contribute a third of ZTE's total revenue.

"Terminal is now also very big because of smartphones and we are pushing our smartphone business through many operators and channels to the mass market. Our smartphone business is getting better," he said.

ZTE's phone revenue last year was $30 million. This year it aims to post $50 million.

Most of its devices are smartphone, but it also provides mobile phones to the low-end market. However its focus is on high-end smartphones priced between Bt10,000 and Bt15,000.

It sells smartphones under the ZTE Nubia brand. Wang said the brand was very popular in China and many countries.

ZTE has been selling smartphones in Thailand for two years. Wang said its market share in the segment was 15 per cent.

He said in Thailand more than half of the total smartphones were Apple and Samsung, while Chinese-brand smartphones were also popular.

"We hope to increase our smart-phone market share 2 per cent or 3 per cent each year for the next couple of years," he said. "After three years, after we have our own branches [working through local channels], we will get a better market share in smartphones."

He said there were three important parts of the Thai market - 4G/LTE, fibre optics, and terminal (phones).

For 4G/LTE, the company bought mature technologies and the latest products to win over consumers, while ZTE's fibre optics team had deployed its networks and solutions.

Wang said that since last year the company's terminal brand had been enhanced through advertising. The focus was the mass market while still working with operators.

"We work with local partners to bring our smartphones to reach customers throughout the country," he said. "We already plan to do some activities, some ads and activities in the big cities outside Bangkok with partners and operators.

"During the last six months, we have already spent about $2 million for marketing. It is not too big but not too small. We will keep investing for this one [on mass marketing for smart-phones] for the next two to three years.

"Over the next six months, we plan to do a new kind of marketing activity … For the entire year, we'll spend $3 million on marketing activities for smartphones in Thailand. It is the beginning for us, thus we have to invest a lot to build our brand."

The company recently established the ZTE Innovation Centre in Thailand in a bid to better meet consumer needs.

"Before, we had only pre-sales here. Now at the Innovation Centre our engineers come here to talk with customers to take their new requirements back to our research and development [R&D] centres in China," Wang said. "We have no plan to set up an R&D centre here in Asean since it is located close to China."

Wang said that the Asean market held a lot of opportunities including in Myanmar, Cambodia and Vietnam.

He said all the countries had 3G, while some had 4G and many had optical opportunities.

"It means every main technology company now has chances to get more revenue … This region, for us, has opportunities and challenges together," he said.

He said that in Asean ZTE was working with 26 operators and its market share when working with operators was between 30 per cent and 50 per cent, depending on the country, while its overall market share for the region was around 35 per cent.

"In the ICT [information and communications technology] field, we will also provide more solutions to more industries such as transportation, education, hospital, and banks," Wang said.

"We are trying to get more and more industries. Our business in this region is so small but we hope it will be bigger in the next couple of years."

He said the biggest challenge for ZTE doing business in Asean were the different cultures and understanding the cultures could help improve its business and relationships with customers.


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