Xiaomi Shoots For Middle In Late 4G Arrival

Xiaomi hypes style with Mi 4

After an embarrassing recent gaffe that saw him ridiculed by fellow smartphone executives, Xiaomi founder Lei Jun was back in the spotlight this week with the launch of his company’s fourth-generation phone aimed at mid-end users. The company managed to get the usual widespread media coverage for the launch of its Mi 4, which it hopes will give it a sales boost necessary to meet an aggressive growth target for this year. But that said, I do sense that media and consumers are starting to tire of the company’s relentless hype and marketing. That could ultimately hurt its growth prospects, especially as China’s mid-range smartphone market becomes flooded with similar products from other domestic manufacturers. Continue reading

GUEST POST-WeChat Story Part 1: In-House Roots

Note: Today marks the start of a series of guest posts on the rise of WeChat, China’s wildly popular mobile messaging giant that now boasts more than 600 million users. The series by freelance writer Lanie Nie will run on alternating days over the next 2 weeks.

By Lanie Nie

Chronicling WeChat’s rapid rise

If you recently traveled by bus or subway in a big Chinese city, you probably noticed one thing immediately — nearly everyone was fixated on the small screens of their smartphone handsets, no matter how crowded the place or how long the journey. At the center of that obsession is the mobile messaging app called WeChat or Weixin in Chinese, which is owned by Chinese Internet giant Tencent (HKEx: 700) and is similar to services like WhatsApp, Kakao Talk and Line.

WeChat might share the same starting point with these popular services, but it has already been telling another story in its home market. With a claimed domestic user-base of more than 600 million, the native mobile app for average Chinese smartphone owners has become a village square of friend updates and subscription feeds, an online storefront for money market fund products as well as a portal into a taxi ride, a group-buying deal and a movie ticket reservation. It’s also an urban guide and offers business review services and a catalog of top smartphone games, which makes it fair to say the world is your WeChat. Continue reading

News Digest: July 25, 2014

The following press releases and media reports about Chinese companies were carried on July 25. To view a full article or story, click on the link next to the headline.

  • Baidu (Nasdaq: BIDU) Announces Q2 Results (PRNewswire)
  • Xiaomi Plans HK Back-Door Listing Using Shell Company – Market Talk (Chinese article)
  • ZTE (HKEx: 763), TIM Brasil to Set Up Next-Generation Broadband Innovation Center (Businesswire)
  • Smartphone Brand Awareness Increasing in China; Apple Still Holds Top Spot – TrendForce (Businesswire)
  • Qualcomm’s (Nasdaq: QCOM) Profit Hurt by Dispute Over China Royalties (English article)

Luxury Dip Takes Bite Out Of Phoenix

Luxury clampdown hits Phoenix

Beijing’s crackdown on excessive spending by officials has claimed one of its first victims in the media sector, with word that leading independent broadcaster Phoenix Satellite TV’s (HKEx: 2008) profits tumbled in the first half of the year due to flagging revenue from luxury goods advertisers. The news isn’t all that surprising, since Beijing’s crackdown has been going on for more than a year now. Now we’ll have wait and see how long the slowdown lasts, whether it intensifies, and who else is most vulnerable. Continue reading

China Telecom Jumps Into 4G, Out Of Airports

China Telecom launches 4G service

China Telecom (HKEx: 728; NYSE: CHA) could quickly regain the growth momentum it lost in the first half of this year, with word that the smallest of the nation’s 3 mobile carriers has already launched 4G service just weeks after getting a license for the business. At the same time, media are reporting that both China Telecom and larger rival China Mobile (HKEx: 941; NYSE: CHL) are preparing to shutter their airport VIP lounges, in a move that was long overdue as each faces pressure to cut marketing costs. The pair of developments show that China Telecom should soon return to positive subscriber growth, after posting net losses in the first half of this year as it waited for a 4G license. Continue reading

Weibo: Xiaomi’s Gaffe, Baidu’s Crawl To Brazil

Lei Jun in online gaffe over Xiaomi 4

Smartphone maker Xiaomi’s co-founder Lei Jun is a marketing master, but his lightweight status as a technology expert landed him in the middle of an embarrassing gaffe in the microblogging realm over the past week. I normally would sympathize with someone caught up in such a gaffe, as such mistakes are usually harmless even if they’re somewhat embarrassing. But in this case I don’t feel too much sympathy for Lei, who is such a tireless promoter for his company that this kind of stumble was almost inevitable.

Meantime, the number “2″ seems to be a magic one for leading search engine Baidu (Nasdaq: BIDU), which made a rare appearance in the microblogging realm to trumpet the formal launch of its new search service in Brazil — its second major foray outside China after a dismal first effort in Japan. In this case, Baidu isn’t really trumpeting the “2″ element of its Brazilian story, even though it took more than 2 years for the launch since reports first emerged of its plans for the site. Continue reading

News Digest: July 24, 2014

The following press releases and media reports about Chinese companies were carried on July 24. To view a full article or story, click on the link next to the headline.

  • McDonald’s (NYSE: MCD) Sticks By Meat Supplier OSI After Yum Severs Ties (English article)
  • SAIC (Shanghai: 600104), Alibaba Partner In Internet Car Initiative (Chinese article)
  • First Foreign-Invested Hospital Approved, Obstacles Remain (Chinese article)
  • Phoenix Satellite TV (HKEx: 2008) Announces Profit Warning (HKEx announcement)
  • Lenovo (HKEx: 992) To Launch, Air Purifiers, Other Smart Devices (Chinese article)
  • Latest calendar for Q2 earnings reports (Earnings calendar)

Alibaba Makes Peace With Banks In Lending Tie-Up

Alibaba in new alliance with banks

A year after it shook up China’s stodgy banking sector with the launch of its Yu’ebao savings product, e-commerce leader Alibaba looks set to give the market another shot of needed innovation in a new tie-up with 7 major banks. This time the aim is to promote lending to small and medium-sized enterprises (SMEs), with a focus on manufacturers and especially exporters. Such companies often have difficulty getting loans from traditional banks for reasons I’ll explain shortly. Thus this new partnership aims to use Alibaba’s mountains of financial data on these smaller companies to help the banks better understand underserved SMEs that are a critical player in China’s economy. Continue reading

Tencent In Rare SNS Pullback On Microblogs

Tencent pulls plug on microblog service

Update: Since originally writing this post, Tencent has issued a statement in response to the original Chinese media reports saying it has no plans to close its microblogging service. It adds the service will be combined with its news service, as part of a broader restructuring of its online media group.

New reports are saying that leading Internet firm Tencent (HKEx: 700) is quietly halting development for its largely ignored microblogging service, in what would amount to a rare admission of defeat in its core social networking services (SNS) business. The move would be long overdue, as Tencent’s microblogging service, a variant of US leader Twitter’s (NYSE: TWTR) service, was never really a major player in China. So in that sense I have to at least congratulate Tencent for finally conceding defeat in the space to Weibo (Nasdaq: WB), the Twitter imitator founded by leading web portal Sina (Nasdaq: SINA). Continue reading

Shanghai Street View: Making Markets

Night market opens at Jinjiang Amusement Park

Shanghai and most major Chinese cities lack organized outdoor food centers and night markets, which are a colorful and popular part of daily life in places like Taiwan, Hong Kong and Singapore. But now that’s changing here in Shanghai, which is rolling out ambitious plans for a series of such centers modeled on the famous Shihlin night market in Taipei.

This kind of move seems long overdue, and could kill many birds with a single stone. Most importantly it would help to rid the streets of annoying hawkers, and it would also remove a source of noise and congestion that is irritating for nearby residents. It would also tackle the problem of food safety, since concentrating such hawkers in supervised centers would make it easier to monitor their quality. Continue reading

News Digest: July 23, 2014

The following press releases and media reports about Chinese companies were carried on July 23. To view a full article or story, click on the link next to the headline.

  • Tencent (HKEx: 700) Halts New Development For Microblog Service (Chinese article)
  • Alibaba Joins With Banks In Online Lending Initiative (Chinese article)
  • New Oriental (NYSE: EDU) Announces Q4 Results, $120 Mln Share Repurchase (PRNewswire)
  • Xiaomi Unveils New Flagship Smartphone, The Mi 4, With A Metal Frame (English article)
  • Apple (Nasdaq: AAPL) Revenue Lags Street’s View Despite Strong China Growth (English article)
  • Latest calendar for Q2 earnings reports (Earnings calendar)