Here’s how MTN, Vodacom, Cell C, and Telkom could end up making (possibly rather a lot of) money out of Huawei’s Android crisis

Source: Vsoft, 18/06/2019

•Last year Huawei started a big push in Europe to popularise its
App Gallery, a substitute for the Google Play Store, Bloomberg
reports.
•App developers were promised access to the huge market in China â€`
and network operators were promised a `significant` share of the
money spent in the store.
•Huawei`s big Android scare this week will only see it accelerate
efforts to go it alone, and that could mean cash in the pockets of
Cell C, MTN, Telkom, and Vodacom.

If Huawei follows in South Africa an approach it has reportedly
adopted in Europe, then MTN, Vodacom, Telkom, and Cell C could all
be in line to share in the revenues generated when their customers
buy apps or content on their Huawei smartphones.
The local networks have long sought to secure a portion of such
software and in-app-purchase revenues, but have largely failed.
The two companies that have a stranglehold over software revenues,
Google and Apple, have never had much incentive to share the
spoils. Huawei, on the other hand, needs their help, and seems
willing to spend money to secure it.
Huawei on Monday received a 90-day reprieve from the American
restrictions that explicitly allows Google to maintain the
relationship between the two companies. That means Huawei can keep
using the full, commercial version of the Android operating system
that currently runs its smartphones.
The rollback of the US restrictions also covers software and
services such as the Google Play Store and the likes of Google
Maps â€` but only for `existing Huawei handsets that were available
to the public on or before May 16, 2019`.
See also: Huawei just caught a break: The US government has
temporarily loosened its restrictions
That means Huawei faces the prospect of yet again having Google
suspend their relationship come mid-August, when the temporary
reprieve expires.
It also leaves in doubt whether Huawei can now ship any new
cellphones that rely on the Google ecosystem.
Instead of depending entirely on the administration of Donald
Trump to allow it to keep doing business with US companies such as
Google, Huawei is expected to accelerate the development of its
own operating system, apparently called HongMeng, while also
preparing to move to the open-source version of Android.
Either way, Huawei will not have access to the Google Play Store,
which hosts the millions of apps available on Android and in 2018
saw an estimated $28.4 billion in global revenue, the equivalent
of R360 billion.
Huawei has apparently already been pushing hard on its in-house
replacement to the Play Store, named App Gallery, with a focus on
Europe.
In 2018, Bloomberg reported on Monday, Huawei tried to entice app
developers to its store by offering them tools to easily port
their software to it â€` and the chance to reach the vast Chinese
consumer market.
For European cellphone network operators the pitch was a `very
significant` portion of the revenue App Gallery makes.
How exactly that revenue share would work is not clear. But if
Huawei and operators follow the typical technology partnership
blueprint, Huawei would track when customers of MTN or Vodacom
spend money on App Gallery, then pass back a part of that money to
the operator in question.
In return the network operators would ensure that App Gallery was
pre-installed on Huawei phones they distribute, and promote its
use among their users, perhaps through mechanisms that include
making available free data for use via App Gallery.
Operators were this week unwilling to comment on Huawei except in
broad and empty fashion.
Asked if it has discussed any incentives to push App Gallery with
local operators, Huawei on Tuesday stressed the importance of
mobile services and said App Gallery `is an important part of
Huawei`s strategy as it is not only a traditional application
store`.
`Huawei’s App Gallery will provide great opportunities for local
companies and South African’s digital talent,` the company told
Business Insider South Africa.
Asked directly if it would share revenues with operators, the
company said: `The Huawei App Gallery adopts a more business mode,
for example sharing mode with the developers.` (sic)
Huawei has been actively courting South Africa app developers for
App Gallery, and it has talked up the importance of South Africa
as one of its key markets.