(Yicai Global) Sept. 7 -- Huawei Technologies has launched its new flagship smartphone series. The Mate 50 is the first consumer phone with satellite communications, but does not support fifth-generation mobile telephony because of US sanctions that limit the Chinese telecom equipment giant’s access to state-of-the-art chips.

Shenzhen-based Huawei launched the new smartphone series yesterday, the day before Apple is scheduled to unveil its iPhone 14, which is also expected to have satellite communications technology, according to TF International Securities analyst Guo Mingxi.

Priced from CNY4,999 (USD716) each, the Mate 50 and Mate 50 pro can link to China’s Beidou global satellite navigation system, enabling users to send emergency messages without a network signal, Richard Yu, chief executive of Huawei’s consumer business and auto technology unit, said at the launch event yesterday. But the function is only available in the Chinese mainland, he added.

Telecoms industry experts told Yicai Global that satellite communication complements ground network telephony. But as the technology is immature, its speed is barely equivalent to that of a third-generation network. Moreover, because of high satellite maintenance costs, phone makers will likely charge according to the number of messages sent.

“Huawei’s Mate series will significantly shock the high-end market,” Guo Tianxiang, senior analyst at market intelligence provider IDC China, told Yicai Global. But the lack of 5G may put off some consumers, he said. China’s high-end phone market is dominated by Apple. The US tech giant has a 70.5 percent share of the market for handset priced above USD600, Guo said.

Last month, Huawei founder Ren Zhengfei said his company is focused on surviving the next three years. “Over-optimistic expectations for the future should be adjusted, and in 2023 or even until 2025, we must adopt survival mode,” he said in an article published on Huwei's internal forum.

Huawei must change its thinking and business policy, from the pursuit of scale to the pursuit of profit and cash flow, Ren said, adding that it will ditch or shrink marginal businesses and cut headquarters’ jobs to conserve resources to strengthen frontline teams.

The company suffered its first-ever drop in annual revenue last year, after income from its consumer business halved following the sale of its Honor budget phone brand in late 2020 as a result of restrictions on Huawei buying US tech such as chips.

The US government added Huawei to its so-called Entity List in May 2019 over alleged national security concerns, hampering the firm’s access to US software and hardware. The ban had a huge impact on its phone business, once the firm’s main revenue stream, forcing it to sell assets and diversify into other areas.

In the short and medium terms, Huawei’s mobile phone chips and overseas market performance still face pressure, according to Citic Securities. Its phone sales are expected to reach 30 million this year.

Editors: Shi Yi, Futura Costaglione