Track Hyper | Honor Zhao Ming: It's Time to Bid Farewell to Apple's Dominance!

In which quarter of 2023 will smartphones return to the growth track, becoming the current focus of the industry.

The lack of technological innovation is the core reason why the smartphone market cannot continue to grow. Even Apple, the company that pioneered the "smartphone" category, has lost its ability to lead the industry in technology innovation after the release of the Apple X, which paid tribute to its tenth anniversary.

In this industry context, Zhao Ming, CEO of Honor, pointed out that "the consumer electronics industry is a long-cycle industry, and the biggest impact is never the economic cycle, but the innovation cycle."

The upcoming Honor Magic V2 with a foldable screen, which will be released on July 12th, is described by Zhao Ming as having a "revolutionary innovative experience." This will be the starting point for Honor's new round of technological innovation, and it is also the confidence behind Zhao Ming's call to "break Apple's dominance and compete in the industry."

Technological Innovation: Lighter than Light

Starting from early 2021, with the loss of appeal in the A-share secondary market for the "Apple supply chain," although the smartphone market rebounded slightly that year, it continued its decline in 2022 and has not improved since then.

The smartphone market reached its peak in 2017. That year, Apple launched its tribute to the tenth anniversary, the "Apple X." Except for 2021, when there was a 6% YoY increase in global smartphone sales due to market unlocking and the low base since 2020, there was no YoY growth in 2018, 2019, 2020, and 2022.

What will happen in 2023?

Canalys analyst Liu Yixuan believes that "the road to recovery for the smartphone market in 2023 is full of uncertainties. Manufacturers and channels will closely monitor market dynamics and maintain a cautious attitude. Popular brands will explore how to drive demand through their established IoT ecosystems, differentiated high-end products, and effective channel and promotion strategies."

When Qualcomm and MediaTek, the leaders in the smartphone chip business, predicted the industry's outlook for 2023 in 2022, their attitude was also extremely cautious.

But there is also good news.

Wall Street News learned from the supply chain that in the fourth quarter of 2022 and the first quarter of 2023, various domestic smartphone manufacturers had varying levels of high inventory. However, by late April 2023, domestic smartphone inventory had returned to a healthy state.

However, the lack of technological innovation is still a common problem in the industry, and it is also the core reason for the sluggish performance of the smartphone market.

Zhao Ming, CEO of Honor, pointed out at the "MWC2023 Shanghai" exhibition held in Shanghai on June 29th that "the consumer electronics industry is a long-cycle industry, and the biggest impact is never the economic cycle, but the innovation cycle."

Zhao Ming is not an institutional analyst, and his focus is not on the industry's general weaknesses. Zhao Ming is concerned about whether Honor's high-end flagship products have made technological breakthroughs. At the "MWC2023 Shanghai" exhibition, Zhao Ming revealed in his speech on the future evolution of smartphones titled "What's Next for Smartphones?" that Honor will lead the industry in introducing AI edge-side large models into smartphones. The new generation of foldable screen, Honor Magic V2, which will be released on July 12, is expected to carry this technological innovation and usher in a new cycle of innovation in smartphones.

In addition, according to information obtained from the supply chain by Wall Street News, the most visible innovation of Honor Magic V2, or the most significant experience for consumers, is that this foldable screen phone is the lightest in the industry, "about 10 grams lighter than Huawei Mate X3." A supply chain source told Wall Street News.

The Huawei Mate X3 weighs about 239 grams in its bare version and is currently the lightest large-screen foldable phone. It has an unfolded screen size of 7.85 inches and a folded size of 6.4 inches. Although the OPPO Find N2 weighs only 233 grams, lighter than the Huawei Mate X3, the screen size of the OPPO Find N2 is atypical for a flat-panel phone, with an unfolded size of 7.10 inches and a folded size of 5.54 inches.

Both of these foldable screens have achieved impressive sales performance in the domestic market.

The current Honor Magic Vs, with a main screen size of 7.9 inches (unfolded) and a secondary screen size of 6.45 inches (folded), weighs 261 grams (bare version). This foldable screen is almost identical to the Huawei Mate X3 in terms of screen size. However, due to its weight, its sales are not as good as the Huawei Mate X3.

As a reference, the Apple 14 Pro Max has a screen size of 6.7 inches and weighs 240 grams. The screen size of the Huawei Mate X3 and Honor Magic Vs in the folded state is almost the same as that of the Apple 14 Pro Max, while the OPPO Find N2 is nearly 1.2 inches smaller.

Therefore, if the weight of the entire Honor Magic V2 can really be 10 grams lighter than the bare version of the Huawei Mate X3, reaching an astonishing 230 grams, it would be a "lighter than light" achievement and would directly set a new industry record.

In fact, when it comes to the foldable screen, the most important experience is the application side. "Lightness" is more important than "shallow creases" and deserves more attention. After all, lightness means lower carrying costs and greater mobility.

The traction of AI large models at the edge

It is still unclear how Honor will introduce AI edge-side large models into smartphones. If it can be implemented, this astonishing (revolutionary, to be more precise) technological innovation will bring a completely new experience. Based on Zhao Ming's limited description, Honor Magic V2 is likely to incorporate some of these capabilities.

For example, through the YOYO intelligent assistant, it will bring experiences such as multimodal natural interaction, precise intent recognition, and closed-loop services for complex tasks. The current AI large-scale model technology reserve on the end-side of the supply chain has not yet achieved commercialization compared to the cloud-side large-scale models, but progress has been made: for example, in early March this year, Qualcomm used the AI software stack of the Snapdragon platform to run parameters exceeding 1 billion for the first time on Android smartphones, which could only be run on the cloud-side before, using the Stable Diffusion model.

The MLC-LLM (Machine Learning Compilation: Large Language Model) developed by OctoML CTO Tianqi Chen has further expanded the possibilities of AI large-scale models on the end-side.

MLC-LLM provides a solution for natively deploying large-scale language models on various hardware platforms, with a maximum of 7 billion selectable model parameters, allowing large models to be applied to mobile devices (such as Apple, requiring more than 6GB of memory), consumer-grade computers (such as Mac), and web browsers.

With the help of MLC-LLM, large-scale language models can be deployed and run on mobile devices. This is a universal solution that allows any language model to be deployed locally on various hardware backends and local applications. MLC-LLM aims to enable everyone to develop, optimize, and deploy AI models on personal devices without the need for server support, while also achieving acceleration through consumer-grade GPUs on smartphones and laptops.

It is difficult to imagine the changes in AI experience after deploying LLM on the end-side, including smartphones, but it is possible to have an AI assistant that can fulfill various roles such as a personal doctor, lawyer, financial advisor, accountant, teacher, or chef, providing cost-effective consulting services to C-end users.

Isn't it amazing?

Regardless of the extent to which Magic V2's end-side LLM capabilities are realized, Honor's intention to promote the landing of AI large-scale models on the end-side is clear. Zhao Ming said, "(Choosing) to adopt end-side large-scale models (as a technological innovation path) is a new starting point for our (product strategy)."

Honor's AI technology began in 2016. In that year, Honor launched the first AI phone equipped with the Magic Live smart system. In 2022, Honor released the platform-level AI "Magic Live Smart Engine" and the "AI-enabled All-Scenario Operating System" MagicOS (Honor's AI value proposition).

These constitute the technical core and basic capabilities of Honor's end-side AI large-scale models.

Since Honor announced its independence on November 17, 2020, it has always adhered to the "dual-drive" innovation concept: one drive is to understand the unmet application needs and pain points of C-end users (consumers according to Honor's definition).

The other drive focuses on technology-driven demand, using the "front wheel of demand insight" to lead the overall industry's technological research and development capabilities through forward-looking technological innovations, such as self-developed RF enhancement chip C1, 3840Hz ultra-high-frequency PWM dimming, Luban 0 gear hinge, Qinghai Lake battery technology, and AI technology that started in 2016. Through the "dual-drive" approach, the integration of meeting the demands of the consumer market and technological innovation for the business market is achieved, thereby realizing the "continuous innovation" and "positive traction" of Honor products.

When discussing Apple's dominant position in the domestic market, Zhao Ming said, "When a new field, new category, or new form emerges, it is the best opportunity to break the competition (pattern)."

The foldable screen field is a new form and new track in the mobile phone industry, and Honor has entrusted this mission to the Magic V2. As Zhao Ming said, only challengers can challenge those who have succeeded.

As a "challenger," Honor is making bold attempts with its own solutions, and once it successfully breaks through the innovation bottleneck and opens up a new cycle of evolution, its technological traction in the industry will be unparalleled. If this is indeed the case, in the not-too-distant future, the reality of "breaking Apple's dominance, with a thousand sails competing" will become a reality.