Smart TVs may become an oligopoly, why can Hongmeng "take office"?

TV manufacturers have been releasing new products intensively, hoping to compete in the second half of this year. On August 10, Huawei released the Honor Smart Screen; on August 16, TCL released the XESS Smart Screen; on August 19, Hisense released the social TV S7. Even Pinduoduo has teamed up with JVC TV to release 4 "smart large-screen TVs." If the concentrated release of new TV products by major manufacturers in the summer is considered a "routine action," this year's innovation lies in "both soft and hard." In the face of serious hardware homogeneity, TV manufacturers have taken a different approach and launched their own smart TV systems as a weapon for brand differentiation and competition. Among them, Huawei launched the Hongmeng system and Hisense also launched the Hi Table smart system.

Does this sign indicate that the competition among Chinese TV manufacturers has already penetrated from the hardware level to the system level? What is the current status of smart TV systems? What is the development prospect of smart TV systems?

Android is no longer the only one

According to statistics, the market penetration rate of smart TVs reached 89% in 2018, and is expected to further increase to 93% in 2019. Smart TV operating systems have become the "standard configuration" of smart TVs. Du Cong, an analyst at CCID Consulting, told the reporter of China Electronics News that the operating system provides a way for hardware devices to manage resources, program control and realize human-computer interaction functions. For smart TVs, the operating system is the first step to realize its intelligence. The operating system gives smart TVs functions such as application expansion (function expansion) and voice recognition (artificial intelligence), which promotes the development of televisions in the direction of intelligence. At present, the operating systems used by smart TVs can be divided into two categories: Android and systems independently developed by various brands, such as Alibaba's YunOS, LG's smart TV WebOS and Samsung's smart TV TIZENOS.

In the early days of smart TV development, Android became the operating system for more than 90% of mainstream products on the market, and this number has continued to decline as each company continues to launch its own TV system. In recent years, Chinese TV brands have frequently launched smart TV operating systems, such as Skyworth's Coocaa system, Hisense's VIDAA-AI artificial intelligence TV system, Alibaba's TV version YunOS system, Xiaomi TV system, and the newly released Huawei Hongmeng system and Hisense Hi Table system. The field of TV systems has shown a flourishing trend, breaking the monopoly of Android TV operating systems. Yang Yisheng, senior account manager of GfK's black electronics division, said that the operating systems developed by Chinese companies now account for about 55%, and Android operating systems account for about 35%.

Analysts have praised the phenomenon of domestic manufacturers launching their own smart TV systems. Yang Yisheng believes that with the operating system, major brands can create personalized solutions and take the lead. Jie Meijuan, deputy director of research at the color TV division of AVC, believes that the advantage of owning a system is that it meets the needs of TV users. This progress has promoted the development and innovation of smart TVs. Du Cong believes that having an operating system not only makes it easier for companies to tailor system rules that are in line with their own product development models based on multiple factors such as their own product positioning, user positioning, and market competition environment, but also has the opportunity to create an independent business model and gain more voice in the fierce market competition. In the long run, my country's home appliance companies have a deep layout in the field of smart homes. With the continuous advancement and development of the Internet of Things and smart homes, the prospects for own systems are very bright.

Ecosystem construction needs to be strengthened

Looking back at the history of Chinese companies launching smart TV systems, major mainstream brands have launched their own operating systems. Although there are many of them, most of these systems only serve their own brand TV products and are rarely adopted by other brands.

Skyworth Group launched the Tianci operating system in 2013. The following year, the Tianci system was officially upgraded and optimized and renamed "Coocaa System". Now the Coocaa system has been updated to version 7.0. It is worth mentioning that the system is not only used in Skyworth TVs and its Coocaa TVs, but also in smart TV products of Panasonic and Philips.  

Another color TV manufacturer, Hisense, has also been committed to the development of operating systems. In 2013, it released the VIDAA smart TV system, which was fully upgraded to the VIDAA AI artificial intelligence system in 2018. This month, Hisense also released the new Hi Table system. Currently, the above systems are only used in Hisense TV products. In 2016, Alibaba Digital Entertainment and Foxconn cooperated to develop a TV version of YunOS system customized for large screens, and claimed that the system was the first smart TV operating system that met the international standards of ID Internet of Things. In the same year, the system was used on Sharp's 60-inch Internet split TV series. Other brands except Sharp did not adopt this system.

In this regard, Yang Yisheng believes that the self-built system is still in the early stages of development, showing a trend of flourishing, but the self-built system in this period will also have shortcomings such as poor adaptability. Du Cong analyzed that building an ecosystem is indeed one of the difficulties in the development of self-built systems of domestic TV brands. He pointed out that the key to the rapid market capture of the Android system lies in its open source nature, massive application resources, and strong compatibility. Therefore, what the domestic TV operating system urgently needs to solve is the problem of building an application ecosystem. Secondly, the lack of maturity of technology is also a stumbling block that hinders the further development and growth of domestic TV operating systems. Judging from the problems reported by current users, domestic systems often experience freezes, inability to boot, or even crashes after long-term use, and the stability of the system still needs to be improved. As the Android system is based on the joint development and construction of millions of engineers around the world, the human resources investment in the domestic system still needs to be strengthened. Jie Meijuan said that different systems are generated to improve user experience, which is the law of industry development. With the improvement of the independent research and development capabilities of Chinese companies, Chinese companies have the opportunity to stand out in the competition to build an IoT ecosystem.

Domestic systems occupy a dominant position?

Although analysts have recognized the launch of self-built operating systems by TV brands, they generally believe that this is a short-term "competition among many players" and that the TV operating system will move towards oligopoly in the future. Yang Yisheng pointed out that with market competition and the survival of the fittest, oligopoly will gradually emerge in the future.

Du Cong believes that the demand for interaction between different smart hardware devices is becoming more and more obvious, and it has become a trend for one operating system to adapt to multiple different smart terminals. In the smart TV (or even smart home or IoT) ecosystem, the operating system only provides developers with a complete set of development specifications and development environment frameworks. It is the application end that can truly create value and provide consumers with diversified services. Therefore, in the ecosystem, there will only be a few operating systems, and the application layer running on them will present a flourishing trend.

Huawei Consumer Business CEO Richard Yu said that Hongmeng OS will be open source, and Honor Smart Screen will become the first smart terminal equipped with Hongmeng OS. When introducing the Honor Smart Screen using Huawei's self-developed Hongmeng OS, Honor President Zhao Ming said that the system adopts a modular design for multiple terminals for the first time, which can be flexibly deployed according to the needs of different terminal application scenarios. So, does Hongmeng OS have the opportunity to become one of the oligarchs of TV operating systems and be adopted by other TV brands?

Professionals analyzed that, like other self-built operating systems, Hongmeng started later than Android and iOS systems. Its biggest shortcoming is that the accumulation of ecological construction is relatively weak and there is a lack of a good application ecosystem.

However, Jie Meijuan believes that Hongmeng also has its unique advantages. Although Hongmeng OS is currently only used in Honor smart screen products, Hongmeng embraces other terminal manufacturers. From an ecological perspective, Hongmeng OS is also open, such as the establishment of an open source foundation and an open source community. In addition, Hongmeng OS has the ability to be used across platforms and the same code can run on multiple types of devices, so Hongmeng is extremely attractive to developers. At the same time, Huawei has accumulated a huge user base and experience in smart terminals for many years, and has advantages in the ecological environment. Therefore, Hongmeng OS has the potential to become the mainstream system in the future IoT. Du Cong predicts that Hongmeng OS will be open sourced in stages like the Ark compiler, but some key local sections will be reserved, such as the cloud service part. If Huawei completes the open source work of Hongmeng OS, it will be available on all smart hardware except Huawei products.