Tag Archives: Xiaomi

Xiaomi latest Business & Financial news from Doug Young, the Expert on Chinese High Tech companies, (former Journalist and Chief editor at Reuters)

SMARTPHONES: Xiaomi Chases Value, Dumps Apple Approach

Bottom line: Xiaomi’s adoption of Costco as its new role model and abandonment of Apple looks like a realistic move, and could better position the company to survive over the next 5 years amid a looming market shakeup.

Xiaomi eyes chic cheap image

Smartphone maker Xiaomi appears to be a company with an identity crisis, with reports that charismatic CEO Lei Jun has dumped former role model Apple (Nasdaq: AAPL) in favor a new model in US bulk-item supermarket operator Cosctco (Nasdaq: CSCO). Many will probably smile at this not-so-subtle shift at Xiaomi, which was one of China’s hottest companies just two years ago when Lei liked to think of himself as China’s Steve Jobs.

But the adoption of a new role model in Costco probably speaks volumes about how Lei sees his company going forward, as he tries to salvage its core smartphone business following a difficult last two years. That fall from grace includes a 40 percent drop in sales in its home China market in last year’s fourth quarter, causing its market share to slip to 7.4 percent, or about half of what it commanded just a year earlier, according to IDC. Read Full Post…

SMARTPHONES: Oppo Lands in India Protest Storm

Bottom line: A mass protest against Oppo in India over a Chinese manager’s desecration of the national flag won’t impact the company beyond a week or two, and reflects cultural sensitivity issues Chinese firms will face as they expand abroad.

Oppo under fire in India

Smartphone high-flyer Oppo is quickly learning the road to India isn’t always so smooth, with word of a mass protest at the company’s local operation due to a controversy involving desecration of the Indian flag. In this case the company appears to be learning a fast lesson in cultural sensitivity, which underscores one of the more subtle lessons that Chinese firms will need to learn as they expand abroad.

I doubt this particular incident will have any long-lasting impact on Oppo, though it will be interesting to see if it might affect its recent major cricket sponsorship deal in India. (previous post) The incident could also make Oppo think twice about its other big plans for the market, namely the building of a major production base there.  Read Full Post…

SMARTPHONES: Oppo Shows India Resolve with Cricket Deal

Bottom line: Oppo’s major new cricket sponsorship deal shows its commitment to India, but may have to be renegotiated if and when the company’s fortunes decline in the next 1-2 years following its meteoric rise.

Oppo in India cricket deal

Smartphone high-flyer Oppo is trying to show the world it’s serious about India, with word it will pay 1.1 billion yuan ($160 million) for rights to sponsor the nation’s national cricket team. News of the deal comes just three months after China’s top smartphone brand announced plans to build a production facility in the hotly contested India market, which has become a magnet for Chinese brands over the last year.

All that raises the question of whether Oppo is for real, or just another passing fad in China’s constantly changing smartphone landscape. That landscape has seen players like Lenovo (HKEx: 992), Xiaomi and Huawei become dominant players in the world’s largest smartphone market one day, only to rapidly fade the next. It’s obviously still too early to say if Oppo will follow in that trajectory, though my educated guess would be the answer to that question is quite possibly “yes”. Read Full Post…

SMARTPHONES: Xiaomi, Vivo Skip Barcelona Telecoms Bash

UPDATE: After publishing this earlier this morning, a source in Barcelona informs me that Oppo is indeed attending and is holding a press event to show off their newest products. Headline and photo caption changed to reflect Oppo’s attendance, but the rest of the original post remains the same.

Bottom line: The absence of Oppo and Vivo from the world’s top telecoms trade show in Spain this week reflects their overwhelming reliance on China sales, while Xiaomi’s absence from the show could be a cash conservation move.

Vivo, Xiaomi absent from top telecoms trade show

Most eyes from the telecoms world will be focused on Barcelona this week, where an annual show that’s arguably the world’s most important for smartphones is taking place. That seems like a good opportunity to look at who from China’s crowded smartphone arena is attending this year’s Mobile World Congress (MWC) in Spain, even though I’m personally not at the show.

Attending the event is by no means cheap, which is probably why some companies may choose the skip the affair. But the decision to attend or not does provide some insight as to what companies are thinking, since you would expect anyone with truly global aspirations to make an appearance at this showcase for the newest telecoms products. Read Full Post…

INTERNET: Ofo Raises Another $150 Mln in Dead-End Race

Bottom line: Ofo and rival Mobike will use their hundreds of millions of dollars in new funds to buy better and more expensive bikes to flood city streets, even though neither has a sustainable business model that can justify such long-term expense.

Ofo raising $150 mln in new funds

The race for supremacy in China’s fast-moving shared bicycle realm is kicking into high gear, with word that second-place Ofo is raising $150 million with an eye on achieving a $1 billion valuation. That would come just a month after sector leader Mobike raised a larger $215 million, in a deal that also valued the company at about $1 billion.

Readers may note that I’ve called this particular contest a “dead-end race”, because I really do think there’s no winner here. That’s because I honestly believe this business is based on a model that won’t work, especially in China. The reality here is that a lack of public spirit means that many people simply use bikes and then carelessly discard them without much thought about whether they might be damaging those bikes or putting them in places that effectively take them out of circulation. Read Full Post…

SMARTPHONES: Brick-and-Mortar Xiaomi Eyes 2017 Comeback

Bottom line: Xiaomi stands a better than 50 percent chance of stabilizing this year and reversing its 2-year-old decline, based on its push into brick-and-mortar retailing and positive reviews for its newest higher-end model.

Xiaomi builds up brick-and-mortar presence

Blame it on the Internet. That seems to be the message coming from Xiaomi, the smartphone maker that’s in a bit of an identity crisis, trying to explain its rapid descent over the last 2 years following a meteoric rise in 2014. A couple of other reports are also saying the company is preparing to roll out its own processor later this year, and have charismatic chief Lei Jun criticizing rival Huawei for lacking the “internet sensibility” needed to succeed in the online era. Read Full Post…

SMARTPHONES: Lenovo Starts Rebuilding Year with Samsung Poach

Bottom line: Lenovo could reverse its smartphone decline this year under a new leadership team anchored by a respected company veteran, though chances of success are relatively low due to stiff competition and magnitude of the task.

Lenovo nets former Samsung smartphone exec

My first post in the new lunar Year of the Rooster seems like a good time to look at the ultra-competitive smartphone market, and what may lie ahead for the embattled Lenovo (HKEx: 992) as it seeks to regain its footing in the space. CEO Yang Yuanqing has made repeated overhauls of his mobile devices division, including the naming of longtime executive Gina Qiao to try and turn the division around late last yaer. Now the latest reports are saying that Qiao has made one of her first big moves in that post by hiring an executive from rival producer Samsung (Seoul: 005930). Read Full Post…

SMARTPHONES: Xiaomi Gets US Black Mark

Bottom line: Xiaomi’s poor handling of a case involving malfunctioning fitness bands in the US is unlikely to erupt into a crisis, but shows how unprepared the company is for moving into PR-savvy western markets.

Xiaomi wristband suffers from bad race relations in US

Smartphone maker Xiaomi just can’t seem to catch a break in the final days before the Lunar New Year. Earlier this week the company made headlines when Hugo Barra, its prized foreign catch who was heading its global expansion, announced he would be resigning and returning to his home in Silicon Valley. Now the latest negative headline is also coming from the US, where media are reporting that blacks are complaining that Xiaomi’s wristband-style fitness tracker doesn’t seem to work for people with dark skin.

It does seem somewhat coincidental that this pair of negative items have occurred in the same week, since Xiaomi has largely fallen from the top news pages these days. If we wanted to say that bad news comes in threes, I could even mention another more significant headline saying Xiaomi’s share of the global smartphone market fell to 3.7 percent last year from 5.2 in 2015. (press release) But that’s a story for another day. Read Full Post…

SMARTPHONES: Xiaomi’s Foreign Prize Barra Heads for Home

Bottom line: The departure of former Google executive Hugo Barra from Xiaomi marks the end of a chapter for the smartphone maker, which stands only a 50-50 chance of surviving over the next 5 years in the cutthroat market.

Xiaomi’s Barra heads back to US

The world was all abuzz in 2013 when Hugo Barra suddenly gave up his cozy position as a high executive at Google (Nasdaq: GOOG) to join a then-little-known Chinese smartphone maker called Xiaomi. Gossip swirled that his departure might be linked to a high-powered love triangle, even though the more obvious explanation was that Barra was leaving to join one of the hottest companies in the world’s hottest emerging market.

Fast forward to the present, where Barra has just announced his resignation from Xiaomi, citing health reasons, among other things. Lots was read into Barra’s original move, so it seems appropriate that we look for similar symbolism in his sudden departure after just over 3 years on the job. We should also look at what the future holds for Xiaomi, whose star has faded considerably since Barra first joined the company. Read Full Post…

SMARTPHONES: Huawei Meets 2016 Goals, Xiaomi Looks to 2017

Bottom line: Xiaomi could return to growth mode in China this year on the strength of stronger models, while Huawei’s local market share will contract as it focuses on profitable sales and backs away from money-losing businesses.

Huawei meets reduced smartphone target

Two of China’s former smartphone leaders are in the headlines going into the weekend, casting a spotlight on the difficulties these past high-flyers face after becoming king of the world’s biggest market. In one story the faded Xiaomi is saying the worst is behind it, and the company is aiming for a relatively ambitious 100 billion yuan ($14.5 billion) in sales this year.

In the other, the still-buoyant Huawei is announcing its smartphone sales rose an impressive 29 percent last year. But that figure is still below its earlier target, and also is being revealed just a week after the company said it was abandoning its older model of growth at any cost. Accordingly, I expect we’ll see sharply slower growth this year for Huawei in China, as it looks for profitable gains over simply getting more market share. Read Full Post…

SMARTPHONES: China Exports Price Wars to India; Nokia Returns to China

Bottom line: Chinese smartphone brands with local production are most likely to survive upcoming price wars they are exporting to India, while Nokia’s new smartphones are unlikely to make any inroads in China over the next 2-3 years. 

China exports smartphone price wars to India

A case of deja vu is rapidly shaping up in India, where Chinese smartphone makers have flocked over the last two years in search of growth outside their overheated home market. In this case media are reporting that Chinese brands have surged to take half of the Indian market by dumping millions of their cheap look-alike Android phones into the country.

Meantime back in their own home country, nostalgia has become the word of the moment with word that Nokia (Helsinki: NOK1V) has officially re-entered a market it once dominated. Nokia joins a number of other faded brands to rediscover China, including former arch-rival Motorola, which has become the smartphone flagship of the brand’s current owner Lenovo (HKEx: 992). Read Full Post…