The life of any modern person, whether he or she lives in a metropolis or in the countryside, is not without a smartphone. The electronics market now offers a gigantic selection of smartphones for all tastes: big and small, expensive and cheap, branded and generic. Since not everyone can afford Apple products, many opt for Samsung or Huawei models. However, it is worth noting that the latter company has now lost its leading position in the global market, and smartphones have fallen in price. So what is the problem? Let’s look into it.

What happened to Huawei?

The first wake-up call was the US President’s law that allows various companies to be listed as potential threats to the country’s security. This happened in 2019, and the manufacturer Huawei and all of its subsidiaries were included in the list. Of course, this had an immediate negative impact. Huawei smartphones have the Android operating system, which in turn depends directly on Google’s services. Since Google is an American company, it almost immediately terminated its contract with Huawei.

The only silver lining was that the law did not apply to those smartphones that were released before the law came into force. At the beginning of 2019, this was not so noticeable because there were a fairly small number of new smartphones being released and they were being bought quite well. In the second half of the year, Huawei was in for a crash, because from every social network, every magazine and every channel people heard about the US-China information war.

Undoubtedly, people’s awareness of the economy and information technology gave Huawei’s products a 43% drop in price in the end. In other words, the company made almost half as much revenue as it had previously made. Due to the lack of demand, manufacturers had to artificially lower the price for greater purchasing power. In 2020, Huawei has not gone anywhere and also produces smartphones, but they are not equipped with the necessary Google services. This prevents the necessary apps from being downloaded from Google Play. However, the company said that it is developing its own operating system, which will appear in new smartphones in 2021 and will be called Huawei Mobile Services (HMS).

It is worth noting that smartphone prices may drop not only because of the information conflict between the two countries, but also because of the release of new models. It has long been known that the introduction of new smartphones in the market gradually reduces the prices of older models.

Thus, Huawei’s smartphones have fallen significantly in price mainly due to the sanctions imposed by the US against China.