Huawei Watch 2 Pro takes on China

Smartphone shipments in china

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Last week, Chinese smartphone vendor Huawei unveiled a new version of the Huawei Watch 2 smartwatch — the Huawei Watch 2 Pro — aimed specifically at its domestic market, according to Android Authority.

In addition to featuring Baidu’s voice assistant, the watch supports contactless payments via Huawei Pay, Alipay and WeChat Pay. Most importantly, the device comes with support for eSIM technology, which allows for 4G, 3G, and 2G connections. This will help address one of the biggest inhibitors to smartwatch adoption — the lack of LTE cellular connectivity.

Huawei is likely banking on targeting the Chinese market to help the company lead the overall wearables market.

China’s wearable market is booming. Forty-three percent of urban Chinese consumers have reported that they would purchase a wearable device, providing a massive opportunity for manufacturers in the market. Already, the total volume of sales of wearable devices is estimated to have grown by 67% in 2016.
Huawei is capturing a larger portion of China’s smartphone market. In Q2 2017, Huawei, the third largest smartphone vendor globally, increased its lead over the Chinese smartphone market, making up more than 20% of shipments in China, up 20% year-over-year. The manufacturers that dominate China’s smartphone market will likely also own the country’s wearable market as consumers tend to stay within the same ecosystem of devices.

But Huawei may face similar backlash to Apple from the Chinese government. Last week, owners of the Apple Watch Series 3 were abruptly cut off from LTE connection in China due to the Chinese government’s security concerns over the device — subscribers in China are required to register under their real names with a network provider in order to receive a SIM card. But the Series 3 contains its own version of the SIM card, which skirts that checkpoint as it’s inserted by Apple and not the state-owned Chinese carriers. With Huawei integrating similar eSIM technology, it could raise concerns that consumers with the new watch will also be cut off from LTE connection.

Huawei, however, may be better positioned than Apple to find success in the Chinese market. That’s in part because the Chinese company has strong ties with the Chinese government, and partly because it may be more willing to release user data to the government, avoiding the same eSIM issues Apple faced in the country.

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