Lenovo, China's biggest personal computer maker by shipments, has traditionally focused on the PC market for growth but is now joining other PC makers to launch mobile devices in a move to diversify into other areas and boost margins.
Executives said Lenovo plans to launch "LePhone" in China first and plans to release the phone in overseas markets later this year.
Since Google's statement last week that it would no longer censor its Chinese Web site even if that meant halting operations in the country, many have been concerned about handset vendors' ability to supply Android-based phones in China.
Google said earlier this week that it is delaying the China launch of two cellphones made by Samsung Electronics Co. and Motorola Inc. that use its operating system.
Google Chief Executive Eric Schmidt said Thursday his company remains "quite committed" to remaining in China, but will in a "reasonably short time" make changes to its now-censored search results. Mr. Schmidt said the company was "in conversation" with government authorities and that Google's business in China today remains unchanged.
"LePhone uses the Android operating system but we tailor our phones with our own applications. We are cooperating with other major Chinese Internet service providers including Sina, Sohu and Tencent," said Lenovo Chief Technology Officer He Zhiqiang.
He said Lenovo will sell the smart phone to all of the three Chinese telecommunications operators, China Unicom Ltd., China Mobile Ltd. and China Telecom Corp.
Lenovo is pinning high hopes on its handset business and expects the growth of handset shipments to exceed that of PCs in the future, Chief Executive Yang Yuanqing said.
Shareholders approved Friday Lenovo's plan to buy back mobile handset maker Lenovo Mobile Communication Technology Ltd. for US$200 million in cash and shares. It sold the unprofitable business in March 2008 to a group of investors led by the private-equity arm of its parent, Legend Holdings, for US$100 million.
"We see an explosive growth opportunity in China's mobile Internet market but the market is lacking the right localized product," said Mr. Yang. "Lenovo has an edge as we have a strong brand and distribution channel in China."
Mr. Yang said China's largest PC maker by shipments aims to become the country's largest handset maker in the future, but he didn't give a specific timeframe.
Lenovo said earlier Lenovo Mobile ranks third in China's mobile handset market by shipments behind Nokia Corp. and Samsung Electronics.
Labels: Android , Other mobile phone brands
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