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Chinese Brands Creep Up the World Smartphone Charts

Stocks in this article: LNVGY ZTCOY AAPL SSNLF

TAIPEI (TheStreet) -- Chinese telecom developer Huawei Technologies (Shenzhen:002502) came out with the MediaPad X1, billed in its homeland's press as the thinnest ever smartphone-tablet hybrid, at a major European tech show last week.

If you're thinking "Huawei? That's just a China brand for Chinese people who can't afford iPhones and Galaxys," you're not alone. But you're not totally right.

Huawei, along with its designed-in-China peers Lenovo (LNVGY) and ZTE (ZTCOY), are climbing the global smartphone market share charts despite a lack of oomph in major developed countries.

As of the fourth quarter last year, Huawei ranked behind only Samsung and Apple (AAPL) for most smartphones shipped worldwide, according to market research firm Gartner. Its full-year 2014 market share was 4.8%, up from 4% in 2012. Lenovo came in fifth with 4.5% of the market, up from 3.2% a year earlier. ZTE was No. 7 with 3.3%.

A lot of the growing market share comes from China, where analysts expect 450 million smartphone shipments this year. But Chinese brands are also dialing into India, Eastern Europe and Southeast Asia, other populous but hardly super-rich regions. The handset processors run slower but prices run lower.

"Chinese smartphone brands have gained market share overseas through a combination of 'good-enough' quality and competitive pricing, typically partnering with local mobile operators to distribute their phones," says Mark Natkin, managing director with tech market research firm Marbridge Consulting in Beijing.

Huawei touts its phablet unveiled at Mobile World Congress as a response to demand for phone-plus-tablet devices in China. The demand? Cheap.

"During its presentation, Huawei highlighted that its aim is to present products at an attractive and accessible price, while never failing to innovate and listen to the needs of its clients," state-run China Radio International said in an online report from Mobile World Congress.

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