Boot up: China goes mobile, Lenovo attacks, Sinofksy spotted, and more - The Guardian (blog)

Lenovo says its smartphone business is unprofitable, without disclosing the loss. But its market share in China, where the company sells most of its phones, soared to 15% in the third quarter from 1.7% a year earlier. That placed Lenovo second only to Samsung, with 16.7%, and well ahead of Apple, with 6.9%, according to Gartner. The research firm predicts that Lenovo will become the No. 1 smartphone vendor in China this year.

Lenovo Chief Executive Yang Yuanqing said recently that the company hasn't been able to generate a profit in smartphones in part because of its investment in marketing and sales. He expects the business to become profitable in China in two to three quarters, he said...

Still, some analysts are skeptical about whether Lenovo can be successful world-wide.

"The strategy of initially seeking a large market share in terms of volume, and then trying to increase margins later, rarely works," said Nicolas Baratte, CLSA's head of technology research for the Asian-Pacific region. Price competition keeps margins thin, he said.