Xiaomi Pulls a Knife, Sword on Electronics Industry
August 27, 2013 Leave a comment
08.26.2013 16:26
Closer Look: Xiaomi Pulls a Knife, Sword on Electronics Industry
Young smartphone maker is apparently preparing to unveil new gadgets, but more than that it is aiming at nothing short of supremacy in its field
By staff reporter Zhu Yishi
(Beijing) – Three-year-old smartphone maker Xiaomi Mobile Internet Co. is again in the spotlight as it draws closer to the debut of much-awaited electronic gadgets. The firm has sent out numerous letters inviting people to attend a press conference on September 5. Printed on the letters are a unique sword and knife, a clear reference to a novel that every Chinese person with the slightest interest in kung fu probably gets. He who owns the sword or the knife can rule the kingdom, or so the novel says. If anything speaks more loudly than ever of Xiaomi’s founder Lei Jun’s ambition for industry supremacy, this is it.He has reasons to feel confident. Xiaomi has reshaped the country’s smartphone industry with high-performance handsets priced much cheaper than other brands with comparable features.
Most analysts agree that the newest version of Xiaomi’s self-branded smartphone, the Mi, will be introduced at the press conference in September. Some also expect the company will roll out a large-screen TV and an upgraded Xiaomi Box, which allows users to watch Internet video on ordinary TVs.
In the first half of the year, Xiaomi sold more than 7 million smartphones for nearly 13.3 billion yuan in sales revenue. This roughly equates to its performance for all of 2012.
On August 22, the same day the invitations went out, Lei wrote on his Sina Weibo account, China’s version of Twitter, that a new round of fundraising valued Xiaomi at US$ 10 billion. He did not say who the investors are or how much capital will be raised.
This comes just 14 months after the company’s last round of fundraising, which netted it US$ 216 million. At the time, investors valued the company at US$ 4 billion.
There is no answer for how Xiaomi plans to use the funds from this latest investment. But one thing is certain: it is aiming beyond the smartphone industry.
Its next priority will be developing interactive entertainment and gaming products for the home. A well-equipped TV set with direct access to the Internet is a good idea, but it is unlikely to have a large user base because people stick with their old TVs much longer than mobile phones.
That is where the Xiaomi Box should come into play. By integrating traditional TV sets with more cutting-edge technologies that afford greater comfort and much more choice online, it can delve deep into an ocean of business opportunities which has largely remained untapped.
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