Global handset brands will face a number of hardships in 2019, with external factors likely to affect their performance including a high maturity of handset products, high market penetration rates, and a slowdown of buying dynamics in emerging markets.

The development of the handset industry itself will also produce some bottlenecks, such as China players' growing presence in the global space, less product differentiation, and a possible delay of replacement demand prior to the arrival of the 5G era in 2020.

China's handset vendors are expected to gear up efforts to further ramp up their share in overseas markets due to a growing saturation on the domestic front. It remains to be seen whether the top-three China vendors - Huawei, Xiaomi and Oppo - will be able to maintain their shipment momentum in 2019.

But there will be still some bright spots to be seen in the horizon in 2019 given that handsets are currently the largest category of consumer electronics products worldwide, and despite the fact that global handset shipments are likely to stay flat at 1.5 billion units in 2019 as compared to 2018.

New applications

In addition to existing features and applications such as large all-screen displays, high memory capacity, high battery power, multiple cameras and optimized photography capability, new applications, including 4G/5G dual-mode, flexible displays and AI-enabled capabilities, will play contributing roles in differentiation in 2019.

Hardware competition will also continue into 2019, particularly in the areas including biometric identification, memory and storage capacity, efficiency of application processors and battery power.

The use of AI-centric applications to enhance portrait shots, depth of field and night scenes supplemented by multi-lens cameras is expected to continue to be the focus of new models to be launched in 2019. The design of multi-lens camera will become a standard for most models after Samsung decided to incorporate this feature into its mid-tier A-series products.

Additionally, in response to the application of high speed transmission of 5G technology, Asustek Computer, Razer and Xiaomi have also enhanced their deployments in the gaming handset sector. Given digital gaming already accounts for the highest proportion for all of application categories on handsets, more brands are likely to step into the gaming handset sector in 2019, which in turn will help maintain steady shipment growth in this niche market segment.

The arrival of the 5G era will also benefit integrated applications of related technologies including IoT, blockchain, VR and AR via smartphones. HTC has rolled out its first blockchain-focused smartphone, the Exodus 1, and more comparable models will come in 2019 along with the expanding deployments of the 5G networks.

Individual brands

For individual brands, Huawei has reached a milestone by outracing Apple to second place in the global smartphone market in the second quarter of 2018. With that performance, Huawei's consumer business group CEO Richard Yu has boasted that his company is expected to tie with Samsung for first place in 2020 and eventually overtake the Korea vendor to become as the world's top smartphone vendor by 2021.

Huawei has shipped 200 million handsets in 2018, which will be still lagging far behind an estimated 300 million units to be shipped by Samsung during the year. However, Huawei still counts heavily on the domestic market where its sales will total 80-90 million units or nearly 50% of its total shipments in 2018.

In other words, with overseas shipments of only about 80-90 million units a year, Huawei's status and influence in the global handset industry still leave much room to be desired.

And even Huawei has been able to ramp up shipments of its high-end P- and Mate-series models in recent years, it remains to be seen if it can continue to make breakthroughs in the premium smartphone segment where Samsung and Apple still strongly maintain their competitiveness. Meanwhile, Huawei will also be unable to maintain a high growth in its export shipments in 2019 and beyond due to fierce competition from its peer companies in China.

And Google's ambition of having a strong presence in the premium smartphone market should not be ignored.

Being a leading provider in a number of platform and application markets such as AI, video, searching, mapping, e-mail and navigation, Google has also rolled out multi-pronged efforts to step into hardware products such as handsets, smart speakers, video streaming devices and VR headsets.

With its core businesses still focusing on platform, software and application products, as well as advertising, Google has been in low-key in marketing and channel development for its hardware products in order to avoid direct competition with its clients, and frequently, some hardware products are released as reference designs for clients.

However, this scenario is set to change as the expense of its hardware business unit has continue to expand following its acquisition of HTC's R&D team. A failure to deliver seemly handset products will eventually heap strong pressure on Google's hardware unit.

The competition in the high-end market will heat up should Google begin to enhance its marketing and channel development, including co-marketing with telecom and channel operators in addition to Google online stores.