Can China Grow an Apple?

Upstart Chinese smartphone maker Xiaomi is on track to post $2 billion in sales, with some tricks borrowed from Apple's playbook. But can it remain nimble in the big leagues?

Published

5 months ago

Categories

Finance

Topics

Smartphones

People

Lei Jun

Places

China, United States of America

Companies

Apple Inc., Xiaomi Corp.

Transcript

Can China grow an Apple? Xiaomi, so far the country's biggest smartphone sensation, is trying. From the look of the product launches and choice of wardrobe To promotional posters and limited sales which create buzz Xiaomi's founder Lei Jun has taken several pages from Apple's playbook - but not its prices. (SOUNDBITE) (Mandarin) FOUNDER & CEO, XIAOMI CORP., LEI JUN, SAYING: "Apple has been very successful and there's a lot worth studying . Many people criticize the Xiaomi launches saying we copy Apple, but Apple's launches have had a huge impact on all global companies, from Amazon to Samsung. To tell you the truth, I think Xiaomi does it best." One key difference: Unlike ultra-secretive Apple, Xiaomi turns to netizens for suggestions. Each week it releases updates for users to try out and takes feedback. (SOUNDBITE) (English) REUTERS TV CORRESPONDENT, JANE LANHEE LEE, SAYING: "So far Xiaomi's strategy has been a hit in China going viral on the Internet with a long wait to get your hands on one of these . Some call it the China iPhone." Xiaomi says it's on track to sell 7 million smart phones this year -- still a fraction of China's booming market. But that would give its sales of some 2 billion U.S. dollars in only its second year -- well past the expectations of investors like Hans Tang. (SOUNDBITE) (English) MANAGING PARTNER, QIMING VENTURE PARTNERS, HANS TANG, SAYING: "So Xiaomi is probably in the history of the VC backed companies, the first, the fastest to hit one billion dollar U.S. in sales as well as being profitable. Faster than Facebook, faster than Google, faster than Apple, faster than Microsoft." Tech consultant Duncan Clark is more skeptical. (SOUNDBITE) (English) CHAIRMAN, BDA, DUNCAN CLARK, SAYING: "Xiaomi has to innovate to survive and it can do that with a relatively small user base, but if they're trying to broaden their reach to lower cost smart phones or even going up the chain, it's going to be very hard for them to do all of that at the same time." So as Xiaomi outgrows its niche it will need to be both big and nimble for it's CEO's visions to bear fruit.