Huawei Consumer Business Group Chief Executive Officer Richard Yu at the launch of the Huawei Mate 20. (Source: Huawei Global Official Twitter Handle)

Smartphone Maker That Overtook Apple Reveals New Flagship

(Bloomberg) -- Fresh from overtaking Apple Inc. to become the world’s second-largest smartphone maker in August, Huawei Technologies Co. unveiled a new flagship device aimed at clinching the top spot.

The Mate 20 Pro, revealed at an event in London Tuesday as a rival to the iPhone XS Max and Samsung Technology Co.’s Galaxy Note 9, includes three rear-facing cameras, facial recognition security and an artificial intelligence engine that can identify objects and people in real time.

Smartphone Maker That Overtook Apple Reveals New Flagship

The Mate 20 Pro, which went on sale today, costs 1,049 euros ($1,214), making it more expensive than Samsung’s comparable flagship model, but about 200 euros cheaper than Apple’s.

Huawei is China’s largest maker of telecommunications equipment, and the world’s second-largest smartphone maker as of August, when it edged past Apple. Only Samsung is left to beat.

The Mate 20 Pro includes a number of features drawn from Apple’s iPhone playbook, most notably the inclusion of an advanced facial-recognition security system that builds a 3-D model of a user’s face in order to authenticate them without the need for passwords or fingerprints.

Speaking on stage at Huawei’s launch event, Google’s vice president of marketing, Bob Borchers, said the search giant and the Chinese manufacturer had collaborated to help the Mate 20 series win the trust of enterprise customers.

The phones are the latest to join the Android Enterprise Recommended program, he said, adding that the Mate 20 Pro was the first device to integrate a depth-aware unlocking system directly into Android. “Huawei’s face unlock can be used in Google Play and any place where fingerprint unlock is used today,” he said.

The phone also features advances not yet seen in flagship products from rivals: While Apple popularized the use of two rear-facing camera lenses, Huawei’s new model has three, each co-developed by Leica. It also includes a fingerprint sensor behind the display itself, rather than underneath or tucked around the back -- something Samsung has tried to innovate into its flagship smartphones, but has so far been absent from commercially available products.

The Mate 20 Pro uses processors designed by Huawei, rather than popular chips produced by Qualcomm Inc. The new phone is able to identify objects in videos a user captures on the device. Previously this was limited to still photographs only.

AI is becoming a key component of Huawei’s business strategy. Last week it unveiled its latest Ascend series of chips, machine-learning capable workhorses that the company says can go toe-to-toe with designs from Qualcomm and Nvidia Corp. It’s also introducing cloud-computing services and dedicated data centers for autonomous vehicles that will run off those chips, delving deeper into territory staked out by Amazon.com Inc. and Microsoft Corp.

Thomas Husson, an analyst at Forrester, said Huawei’s hardware prowess is "impressive," but its branding is holding it back from becoming the global industry leader.

"If Huawei manages to reinforce its brand personality, I think the Chinese company can continue to increase its market share, particularly over here in Europe, and particularly to the detriment of Samsung,” he said.

The company is all but invisible to consumers in the U.S., where less than 1 percent of its revenue is generated. Political headwinds related to Chinese manufacturers and national security haven’t helped, and neither did Verizon Communications Inc. and AT&T Inc.’s January decision to stop selling its devices.

Huawei’s consumer division chief, Richard Yu, said in an interview at the launch event that "it would be difficult" to sell the Mate 20 in the U.S. as a result. "Without the carriers, we cannot sell it," he said. "Consumers are used to buying phones from carrier channels, especially for the high-end products."

Roberta Cozza, personal technology research director at Gartner, said that expansion to new geographies is key for Huawei to sustain volume growth, and that a "lack of presence in the U.S. is, and will be, a key limitation."

©2018 Bloomberg L.P.