New chapter for Chinese phones

Behind the success of a smartphone that permeates a market worth hundreds of billions, Chinese companies have found a way to revitalize production, becoming an important force that leads the evolution of the global mobile phone industry.

In the age of AI, we have entered an era where quality trumps quantity. Against this backdrop, the term ‘new productive forces’ has been frequently mentioned. Waves of development are pushing industries to actively explore revolutionary technologies. By driving industrial innovation with technological creativity, companies seek ways to apply disruptive technologies in engineering and industrial applications. This constant pursuit is birthing new industries and models, constructing new growth engines and competitive advantages, and securing a proactive stance in development.

Technology is the primary productive force; innovation is the primary source of motivation. Amidst a trend where every sector’s participants actively engage in newness, Chinese-made smartphones have notably shined. At the start of 2024, domestic phones are experiencing a surge in demand, making them hard to come by. Data shows that in January, mainstream Chinese brands captured nearly an 80% market share, highlighting their dominant position. This achievement is not only a snapshot of the rise of China’s industrial chains during the global mobile phone industry’s downturn but also a vivid portrayal of the robust development of China’s new productive forces.

Those who understand the trends have clear insights; those who follow them possess wisdom. Chinese smartphones, rising in global competition, are telling a story of discovery and breakthroughs in the industrial chain. Recently, Xinhua News Agency published a featured report titled “Chinese Smartphone Innovations Witness New Breakthroughs in the Industrial Chain”, delving into how Honor, through innovative production, has become an important force leading the world’s mobile phone industry’s evolution.

Chinese Smartphone Innovations Witness New Breakthroughs in the Industrial Chain

How did Honor achieve such significant development? What unique aspects of “newness” lie behind it? A deep analysis into the breakthroughs in the “chain” reveals the answer.

Overtaking in a New Lane with Just a Screen

Throughout more than two decades of the development of the smartphone industry, the importance of industrial chain innovation has become increasingly apparent, even deciding the industry’s pecking order. The manufacture of phones, a tech-intensive industry demanding a high level of comprehensive capabilities, relies on collaborative coordination across the entire production and supply chain.

From procurement and production to assembly, an iPhone has about 1,500 components, created through collaboration with over 200 suppliers worldwide. Since 2010, research company Gartner has rated Apple’s supply chain as one of the best in the world. The rise of the iPhone can be attributed to its unique industry chain-centric strategy, which, by grasping industry development trends, allowed Apple to control key technologies and maintain quality, quickly evolving into a global tech giant.

Because of this, being part of the “Apple chain” was once considered the “golden rice bowl” for upstream suppliers. However, as the innovation from the lead company slows down, and issues with Apple’s tight control and lower profit margins for suppliers become more pronounced, the Apple model of partnership has been showing concerns. This signals that the collaboration model in the smartphone industry chain needs to be updated. A brand’s success is never dependent on one single entity’s dominance; improving the entire chain’s technological competitiveness and achieving integrated development between upstream and downstream industries is key to breaking new ground.

Thus, Chinese smartphone manufacturers have charted a new “chain” path. Relying on a solid manufacturing foundation and advanced industrial chain systems, China’s mobile industry has leaped from following to leading, from imitation to innovation – gaining control over the industry’s discourse. This demonstrates that the advanced manufacturing cluster of efficient coordination within the smartphone industry chain represents a microcosm of the high-quality development of China’s manufacturing industry.

Currently, in the Pearl River Delta region, a smartphone can have 95% of its components supplied within a 1-hour commuting radius. The process of selecting 400 types of components for research and development in Shenzhen or Huaqiang North might only take two days, whereas in Silicon Valley, the same process would take at least two months.

In the Honor Smart Manufacturing Industrial Park in Pingshan District, Shenzhen, the story of a phone screen is an excellent example of how Chinese smartphones are overtaking the competition in a new lane. As screen ‘involution’ becomes inevitable, the brand’s answer isn’t to join the arms race of higher brightness, resolution, or refresh rates. Instead, it has carved out a new essential market over three years.

In 2021, Honor independently invested 1 billion RMB to upgrade its smartphone screens, astutely recognizing the severe issue of eye protection when transitioning from LCD to OLED screens. Despite OLED screens offering higher contrast and more vivid colors, their single-layer, self-lighting characteristics result in uneven brightness distribution, which can cause greater eye strain.

Yet, health display technology is a systemic project. It requires not only an abundance of underlaying tech research and powerful tech reserves based on insights into user habits but also the capability to vertically integrate advantages found in the industrial, innovation, and talent chains.

Honor’s Green Oasis Eye Protection Laboratory and its “Honor Green Oasis Eye Protection Screen” technology brand are born from this context. Building on an early investment of over 1 billion RMB, Honor announced an additional 1 billion+ RMB in research and development investment planned over the next three years. The goal is to collaborate on eye protection technology development with screen manufacturers, medical institutions, industry organizations, and research and academic institutions. The aim is to create a humanized, professional, and standardized health display that not only fortifies the brand’s gene for eye protection but also leads the industry in fostering market vitality, achieving the shared construction of a health display ecosystem, and bringing to the world a leading self-developed national product in eye protection screens.

The involvement of numerous industrial chain partners ensures that Honor is not walking this path alone. —

Instead of a desolate journey into the “no man’s land” of technology, partnerships with multidisciplinary industry authorities have made this path a scenic adventure. Currently, in the industry, aside from Honor’s Oasis Eye Care Display, there’s Xiaomi’s Emerald Eye Care Display, OnePlus’s “Bright Eye Care” technology, and others.

Inspired by automotive-grade screens, Honor’s tech team turned to the technology used by Mercedes-Benz’s luxury vehicles. LG Display, the supplier for these high-end cars, employs a dual-layer stacked OLED technology, which maintains clarity under intense light conditions such as sunlight and headlights, and boasts a lifespan of over ten years.

Observing technological trends, Honor swiftly entered a deep collaboration with display giant BOE. After three years of concerted research and development, they proposed an industry-first “dual-layer stack luminous solution.” This innovation, through the synergistic operation of dual luminous layers combined with the new K2 luminous material, increases the screen’s luminance efficiency by 65%, leading to improvements in brightness, energy efficiency, and lifespan for OLED displays.

On the hardware front, Honor’s stacked light Oasis Eye Care Display technology has achieved an HDR peak brightness of 5000 nits, a full peak brightness of 1800 nits, and supports a uniform low power design ranging from 2 to 5000 nits at a refresh rate as low as 1Hz. Tests indicate that the higher the screen’s set brightness, the greater the power savings of Honor’s Oasis Eye Care Display, with savings up to 40%.

With algorithmic improvements, Honor has introduced pixel-level dynamic compensation technology for screen life extension, which can enhance the lifespan of the screen up to six times through dynamic pixel brightness adjustment. According to tests, after three years of normal use, the screen’s brightness decay is less than 1%. This ensures that from the time of purchase to the point of upgrading, the screen’s brightness remains well above the industry average.

It is foreseeable that this high-performance, low-energy consumption “dual-stack light” technology will gain increasing attention and adoption by more smartphone manufacturers. With the widespread application of this innovative technology in more mobile devices, consumers will experience enhanced screen brightness with reduced power consumption and sustained brightness that feels like new even after extended use. This will further usher in the era of flagship smartphones with stacked light displays, creating new opportunities and expansive development potential for the Chinese smartphone industry and the entire technological supply chain.

Honor’s influence extends beyond the driving force behind the development of advanced upstream technologies and leading industry trends. Since 2022, LTPO screen driving technology has gained prominence due to its advantages in fluidity, visual effects, eye protection, and energy consumption—but its widespread adoption was hindered by high costs and immature supply chains.

At that time, Honor, in partnership with Visionox, overcame these hurdles by collaborating with leading IC and panel manufacturers to design a complete solution covering chip planning, panel design, circuit timing, software systems, and application ecology. For the Honor Magic6 series, this culminated in 8T LTPO technology with 4320Hz PWM dimming—making it the first Chinese display to feature low power LTPO display technology across all scenarios and domains.

With these technical advancements, Honor has redefined the new standard for flagship smartphone displays. The mass production of these screens will notably accelerate the adoption of 8T LTPO technology as a standard feature in flagship products, representing not only a significant technological leap but also moving the display industry toward more advanced and efficient realms. This breakthrough will undoubtedly lead China’s OLED industry to the forefront of global technology.

In the arena of new display technologies, China’s industry has already invested over 1.5 trillion yuan and boasts the world’s largest panel production bases. However, despite this scale advantage, China has long faced a dilemma of being dependent on imported key materials and core equipment, presenting a “large but not strong” industry. But with companies like Honor driving research and development and innovation in partnership with the upstream and downstream industry and supply chains, domestic producers of raw materials and equipment are experiencing a dual boost from industry growth and domestic substitution. China’s OLED industry is moving towards true self-sufficiency and control, not only expanding its scale but also achieving a qualitative leap in technological innovation and supply chain integrity.

Globally, the Chinese wisdom and strength in display technology are increasingly evident. According to Omdia’s capacity data, Korean manufacturers’ share of the OLED market has dropped from around 84% in 2018 to about 60% in 2022, with OLED production capacity accelerating its shift to mainland China. As domestic OLED industry chain companies step into a golden age of growth, they are poised to play a pivotal role in the global OLED market.

Honor’s Innovations Propel the Industry Forward

The year 2024 is destined to be a milestone year for mobile technology innovation. At the start of the year, the mobile imaging sector also witnessed a groundbreaking development—the LOFIC technology. The main difference between smartphone photography and professional equipment lies in the ability to handle complex lighting and high dynamic range scenes. In backlit and sunset scenarios, phone cameras often have problems like overexposure and shadow distortion due to the limitations of the device’s dynamic range.

The development of mobile imaging has progressed from simply “being able to photograph” to “how to photograph well.” Imaging sensors in phones can no longer be judged solely based on size, but are instead shifting towards higher dynamic ranges. LOFIC technology, with high-density capacitors integrated into smartphone camera modules, achieves the maximum dynamic range possible given the physical size constraints of the sensors. ## A New Chapter for Chinese Phones

With the improvement in dynamic range, mobile photography is getting closer to the performance of professional cameras. Complex lighting is no longer a constraint on capturing more realistic and detailed scenery details, resulting in a higher success rate in photography. For ordinary consumers, high dynamic range makes shooting more natural and authentic, enabling them to capture beautiful moments in life regardless of lighting changes. At the same time, professional photographers can retain more details, process them more freely, and meet various artistic editing needs while maintaining the realistic feel perceived by the human eye.

Given the lack of mass production experience in the domestic industry chain, the collaboration between Honor and Hawkeye this time breaks through the limitations of the domestic CMOS industry, elevating wide dynamic range to a world-leading level. This disrupts the current situation of high-end sensors being monopolized by foreign brands like Sony, opening up new imagination space for image innovation.

Apart from the previously mentioned Honor’s collaboration with BOE to introduce the industry’s first Tandem series OLED architecture, which incorporates the Honor Eye Oasis eye-protecting screen, the latest Honor Magic6 Ultimate Edition and Honor Magic6 RSR Porsche Design, released at the Spring flagship product launch on March 18, also feature a DSLR-grade ultra-dynamic Hawkeye camera. This technology, inspired by advanced ideas from image sensors and LiDAR used in automotive environment perception for autonomous driving, includes the custom H9800 sensor based on LOFIC technology with ultra-high contrast ratio, and a 1200-point LiDAR array focusing system. This pioneering technology explores new avenues, leading the way in striving for “camera-like images from smartphones”.

In the realm of screen glass development, Honor and Chengdu Bright Optoelectronics pioneered the “single-step crystallization” engineering solution, breaking through the limits of glass material. This innovation eliminates the traditional two-step crystallization process for screen glass by shifting the technical requirements upstream to the raw material stage. This simplifies the production process, enhances production efficiency, and significantly improves product quality and performance. The Honor Magic6 Ultimate Edition and Honor Magic6 RSR Porsche Design feature the Honor Diamond Rhino Glass, produced based on second-generation nano-crystalline glass technology, along with a new high-hardness wear-resistant material, silicon nitride coating, which provides a 10-fold increase in drop and scratch resistance.

Transitioning from the traditional “two-step crystallization” to the innovative “single-step crystallization” not only simplifies the production process but also marks a leap in glass panel manufacturing technology, reflecting an inevitable trend in the industry’s development. With Honor’s open-source technology approach of proposing, exploring together, and sharing with the industry, paving the way for further advancement, the “single-step crystallization” technique is expected to mature and become more widespread. This change will further propel the rapid development of nano-crystalline glass technology, accelerating its application and adoption in consumer electronics.

This year, satellite communication is a strategic battleground where mobile phone manufacturers are vying for superiority. By enabling direct connection to satellites, users can stay connected even in areas with poor mobile signal coverage, ensuring they are “always online”.

In the past, satellite communication was limited by high power consumption and bulky equipment, mainly accessible through specialized devices or expensive “phablets”. Recognizing the unmet needs of a significant user base, Honor and China Crystal Semiconductor jointly developed the Honor Swifts Communication Technology solution. According to Honor, the satellite communication chip’s size has been reduced by 40%, offering performance nearly comparable to professional satellite phones with faster satellite acquisition speeds. In terms of energy consumption, even under a 5% super-low power scenario, the system can support 8 minutes of real-time voice communication or send 16 two-way SMS messages.

Looking ahead, Honor and its partners opting to open-source this leading self-developed satellite communication technology solution will undoubtedly draw widespread attention and active follow-up within the mobile phone industry. It is foreseeable that, over a certain period, the entire industry will undergo a profound transformation in satellite communication technology. This shift will not only drive the synergistic evolution and development of the industry’s upstream and downstream segments but also promote innovation and upgrades across the entire industry. With satellite communication technology’s continuous dissemination and application, a new era of communication is silently unfolding.

Collaboration across diverse technological dimensions such as screens, imaging, glass, and satellite communication has always been a monumental challenge for industry chain enterprises and end manufacturers. Nevertheless, it is precisely these challenges that make each successful collaboration all the more precious. Honor understands that only by overcoming various obstacles and working hand in hand with supply chain enterprises can they jointly drive technological innovation, industry upgrades, and achieve mutual benefits for both sides. This collaborative innovation approach not only helps Honor overcome technological bottlenecks but also injects new development momentum into the supply chain enterprises.

Unleashing the Power of Billions with the Chain as the Spear

At the recently concluded Mobile World Congress MWC2024, Honor launched a new generation flagship, Honor Magic6 Pro, for the global market. Additionally, the brand clinched the prestigious “Best Product Award” from the organizers with the Magic V2 RSR Porsche Design Edition. Through its forward-looking vision, bold actions, constantly innovative product features and experiences, Honor continues to redefine our understanding of the “possibilities” of smart terminals. It has once again underscored China’s tech prowess on the world stage.

In the cold winter of the smartphone market in recent years, the industry has faced significant challenges, with many companies going through unprecedented difficulties. Saturation, intense competition, and a lack of innovation have plunged the industry into a crisis. Honor’s openness and empowerment within the industry undoubtedly serve as a driving force towards a brighter future. In the process of advancing the industry chain, it is crucial for the “chain owner” to collaborate with upstream and downstream partners to break through technological barriers. Honor actively collaborates with industry colleagues, pooling wisdom to collectively tackle technical challenges and drive revolutionary advancements in industry technology. Furthermore, sharing achievements is at the heart of collaboration. Honor upholds an open collaboration approach, sharing innovative outcomes with industry partners to elevate and progress the entire industry chain.

Ultimately, this open collaboration model will bring profound progress to the industry, accelerating innovation cycles and propelling the entire industry towards higher stages of development. Honor’s open strategy not only showcases its forward-thinking vision and openness but also injects new vitality into the industry’s sustainable development. As global tech innovation experiences an unprecedented surge, the Chinese mobile phone industry is driving the technological ceiling of smartphones higher under the impetus of new quality productivity, pushing the entire industry towards loftier goals.

Through the Honor Magic series flagship carriers, leading the future of technology innovation, Honor continuously converts cutting-edge technological breakthroughs and innovative achievements into products, engineering applications, and implementation in collaboration with industry chain partners, becoming a significant driver in activating new momentum for the development of China’s future mobile phone industry.

As OLED, glass, image sensors, satellite communications, and other cutting-edge technologies are successively propelled into large-scale production and engineering applications by brands like Honor, domestic smartphones will engage more deeply in global competition. This engagement will play a key role in restructuring the global industry landscape, activating crucial forces for the future development of the industry.

At the beginning of 2024, among the top 6 smartphone manufacturers in China in terms of shipment volume, only Huawei and Honor achieved year-on-year positive growth. In 2023, Huawei’s substantial lead ignited a trend in smartphones. Now, Honor, securing the top spot in Android shipments in the Chinese market in 2023, has emerged as an unstoppable force, becoming a key player driving industry enhancement following Huawei.

A new innovation cycle has arrived, benefiting top players. As a “young” brand, Honor, in less than four years, has transitioned from being a technology front-runner to a key player in the industry chain through close collaboration with upstream suppliers, leveraging its technical strength and innovative capabilities.

Nurturing new quality productivity will accompany the entire process of China’s modernization and will be the core essence of China’s high-level openness and high-quality development. Encouraging new quality productivity requires more “chain owners” like Honor to drive technological revolutions and bring about more disruptive breakthroughs.

Behind a smartphone that connects billions in output value lies the birth and implementation of new technologies, products, and projects that represent new quality productivity. Supply chain enterprises involved in this process are gathering and breaking barriers thanks to Honor, becoming a pivotal force in shaping the industry’s direction. Regardless of how the industry evolves in the future, establishing an industrial chain ecosystem with advanced technology at its core, continuously delving into foundational technologies, maintaining an open mindset, and expanding collaboration circles, will always be the solid foundation for success.

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