Richard Yu Chairman of Huawei Devices @ MWC Barcelona said that they are going to go aggressively on the Handset market.

We are dramatically changing our strategy. No matter what phone, whether it's low-tier, mid-range or high, all of our phones should be the best. In the past we've been mainly an ODM, working with carriers. They're always saying "we want lower prices." This squeezes us and it makes life quite difficult. So we'll still do some ODM, but we want to become more of an OEM using the Huawei brand.
Every component inside the phone, no matter whether it's the camera or microphone, it's going to be the best in class. In three years we want the Huawei brand to be the industry's top brand. I have a strong feeling that the industry is consolidating.
Vodafone will launch the Huawei brand in April in more than ten countries globally. In the past Vodafone has used our phones as an ODM, with no Huawei brand at all.

This could involve selling very high quality hardware (on Android presumably) at low prices in order to lift the consumer impression that Huawei offers great phones at good value. For those that have little differentiation this could make life extremely difficult and press margins further.

Great Going Huawei!!!