From Bloomberg’s “Chinese Phone Giant Cuts Jobs After Going Up Against Apple” posted Wednesday:
Smartphone maker Oppo is cutting around 20% of staff in key software and device teams after it merged operations with affiliate OnePlus, the first major consolidation in a Chinese mobile industry struggling with chip shortages and Covid-triggered economic shocks.
Oppo, which in 2016 became the country’s top-selling brand, is retrenching after expanding too rapidly on the hiring front in recent years and attacking a premium segment dominated by Apple Inc., people familiar with the matter said. The cuts affect important units including a team that customizes Android into its in-house ColorOS, and an Internet of Things division that develops a spectrum of wearables such as smartwatches and earbuds, said the people, asking not to be identified discussing a private matter.
Shenzhen-based Oppo built one of China’s biggest smartphone brands by rallying private retailers in rural areas and tricking out its devices with larger batteries and memory. But heavy investments to expand into markets from India to Southeast Asia and Europe have not paid off as expected against fierce competition from the likes of Xiaomi Corp. and Apple. It’s now contending with a Chinese retail slowdown as Covid’s resurgence locks down parts of the country.
Forays into adjacent arenas also haven’t worked out. After several years, Oppo’s share of the global smartwatch market remains under 1%, while it accounts for a mere 1.7% of earwear shipments, IDC analyst Bryan Ma estimated.
My take: Making phones that look like Apple’s is not the same building a smartphone ecosystem — or an enduring brand.