China'sanswertotheapplesuccessstory?

China's answer to the Apple success story?

Updated: 2012-06-07 08:03

By Shen Jingting (China Daily)

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The front desk of Xiaomi Corp's headquarters in Beijing. Feng Yongbin/ for China Daily

Xiaomi Corp's Lei Jun wants to emulate legendary US brand

Will any Chinese mobile phone company replicate Apple Inc's tremendoussuccess? The answer from Lei Jun, chairman and chief executive officer ofXiaomi Corp, may be a big " Yes".

Established in April 2010, the Beijing-based Xiaomi offers high-capabilitysmartphones bel ow 2,000 yuan ($317), an aggressive pricing strategythat almost puts the selling price at i ts factory cost.

Since its debut on Aug 16 last year, the 1,999 yuan Mi-One, the first generation of Xiaomi mobile phones, has attracted great attention in China. About 300,000 Xiaomi handsets were pre-ordered in the first 34 hours after Xiaomi accep tedonline booking from Sept 5, 2011. The company had to immediately suspend selling becausestocks ran out. On Dec 18, Xiaomi resumed online sales but its stockpile of 100,000 handsetsbegan to run out in just three hours.

In an exclusive interview with China Daily, Lei said he expected the company to sell more than 5million Xiaomi handsets by the end of this year. Xiaomi's revenue is likely to excee d 10 billionyuan this year, he predicted.

The broader vision of Xiaomi, Lei pointed out, is to ship more than 100 million smartphon esannually for one model by 2016.

"I know it (the vision) is crazy, but we would like to have a try," said Lei. Cupertino-based Applemanaged to sell more than 90 million iPhone devices last year. It is widely believed that Applewill break the 100 million unit mark this year, although it has been less than five years since thefirst iPhone launched in 2007.

Obviously, Lei at Xiaomi dreams of a similar growth pace as Apple's. "If one electronicconsumer product really catches on, it will spread at an extremely rapid pace, beyond what youcould imagine," he said.

Go with the trend

Lei, 43, is a serial entrepreneur and an iconic business leader in China's software and Interne tindustries. He became CEO of Kingsoft Corp, a leading Chinese software developer, at t he ageof 25. In 1999, he invested in the e-commerce company Joyo.com but sold the we bsite toAmazon in 2004 for $75 million.

Kingsoft went public on the Hong Kong Stock Exchange in 2007 and Lei retired. After lea vingKingsoft, Lei acted as an angel investor and made investments in a bunch of well- knownChinese Internet companies, including online clothing retailer Vancl.com and UCW eb, a Beijing-based mobile Internet browser manufacture.

With considerable wealth accumulated from his early experiences, Lei enjoys financial fre edomand has no need to work for a living. However, he did not choose to lead a relaxing life but hasthrown himself into the hard, competitive smartphone industry.

"Setting up Xiaomi was doing the right thing at the right time," Lei said.

During his retirement, Lei did some serious thinking. The most important thing he learned wasthat if one individual wants to achieve really big success, he should always follow the trend,otherwise, his efforts will be in vain. "When I was at Kingsoft, I was under pressure and worked hard, but the results were not satisfactory. On the other hand, I discovered some Internet companies, such as Sina.com andSohu.com, easily made fortunes and had a greater influence on society," Lei recalled.

"I really struggled then," Lei said. Gradually, he concluded that doing the right thing is mu chmore important than doing the thing right. He used to tell a joke - a pig could fly if it find s itselfin the eye of a storm. By this he means things get much easier if one jumps on the bandwagonof existing trends.

Now the mobile Internet is the next big trend, and Lei is determined not to miss it.

Mary Meeker, a former Morgan Stanley analyst, predicted as early as 2009 that more use rswould access the Internet via mobile devices than desktop personal computers within fi veyears.

"Smartphones, e-book readers, connected in-car electronics and wireless home applianc es likegaming consoles would sell more than 10 billion units by 2020. That's 10 times mor e devicesthan there are desktop PCs," said Meeker in a report published in 2009. She pr edicted that themobile Internet revolution will produce a new crop of winners, whose rank s won't include today'sgiants.

That may probably create opportunities for Xiaomi. Lei hopes his company will become a Fortune 500 consumer electronics company someday, competing with the likes of Apple andSamsung Electronics Co Ltd.

China, a country with the world's biggest mobile population of more than 1 billion, has nat urallybecome the birthplace of world-class smartphone companies because of its huge m arket.

China overtook the United States to become the world's largest smartphone market by vo lumein the third quarter of last year, according to the research firm Strategy Analytics. "China is nowat the forefront of the worldwide mobile computing boom," said Neil Mawsto n, executive directorat Strategy Analytics.

Lei expressed similar optimism about the Chinese smartphone market. Volumes are high nowbut the country still has even bigger potential, he said. "I expect two- thirds of Chinese peoplewill be using smartphones by 2013," Lei said.

"We may go with the trend this time - the initial popularity of Xiaomi has proved that," Lei added.

Why Xiaomi?

The overnight success of Xiaomi almost caught Lei off guard. Limiting the supply of Xiao mihandsets led to media accusations of "hungry marketing". It's a practice that seeks to work up afever for a product that becomes contagious. Although everything is still under control and is going forward step by step, Lei admitted Xiaomimoved much faster than he expected. "We had a four- year plan but we finished it in two years,"he said.

The success of Xiaomi phones is down to three things, Lei added. First, one-third of Xiao midevice-design ideas come from what users want. Second, Xiaomi sells handsets mainl y throughe-commerce websites, which cuts costs and helps lower the selling price. The t hird reason maybe the most important - Xiaomi doesn't expect to make money from sellin g handsets but hopesto realize profits by providing software and related services, Lei sai d.

Xiaomi drew ideas from the Internet, gaining a reputation through word-of-mouth and sol dhandsets using e-commerce channels.

Roger Sheng, a Shanghai-based analyst with Gartner Inc, said one of the most important reasons why Xiaomi experienced success is because of the word-of-mouth effect promot ed bymillions of Xiaomi fans.

"There is no other way to purchase Xiaomi handsets except through online channels, whi chresulted in more people rushing to join the line-up because they're afraid of failing to ge t one,"Sheng said.

Xiaomi's targeted customers are hardcore mobile device users. Most of them are fanatica labout mobile devices, tend to be opinion leaders and like to suggest to their friends what handsets to buy.

It is true that Xiaomi paid attention to nurturing a close relationship with its customers. Ina ddition to making smartphones, the company launched a cartoon character, the rabbit Mi- Tu,made promotional mini movies and designed special souvenirs, such as T-shirts, to att ract andretain users.

Lei named April 6, the day when Xiaomi was established, as the annual carnival for Xiao mi fans.During the first event this year, hundreds of fans, invited from across the country, gathered in asmall hall in Beijing's 798 art district, and chatted as if they were old friends at a reunion.

Some followers have made special music videos and add-ons for Xiaomi smartphones. O therssaid they had collected almost all the mobile phone cases of different colors produce d byXiaomi. "Xiaomi is the only smartphone brand that really captures my heart," said Liu Cheng, aXi aomi user.

The 1,999-yuan classic model, together with its 1,499-yuan youth version smartphone,su rprised the market at first, said Ji Chengdong, an analyst with research firm Frost & Sulliv an. "Xiaomi became the first company to sell high- end smartphones at a relatively affordable price,which definitely drew the most market att ention."

Shen Sui, an Internet analyst at consultancy firm iResearch, said: "Xiaomi has essentiallyimitated Apple's marketing strategy." Likewise, it aims to make a p rofit by combining the sales ofhardware with its software, such as Miliao.

"The phone is clearly targeted at people on lower incomes who want a smartphone but c annotafford those priced at 4,000 yuan or more. This is a niche market that is largely igno red in thesmartphone sector," Shen said.

Going global

Xiaomi will start selling smartphones in the overseas market in the second half of this yea r, Leisaid. Rather than go to developed economies, such as the United States or Europe, Xiaomi hasa more practical strategy - entering emerging markets.

It still needs time for customers in developed economies to recognize and accept a Chine sebrand, Lei pointed out.

Countries such as Russia, India and Brazil may become the first destination markets for Xiaomi. "Because Xiaomi is a unique mobile phone vendor that has largely built its reputation thro ughthe Internet, we need to select markets with a good e-commerce environment and a well-established social network," Lei added.

"Similarly, Xiaomi will form a fans' group in every country in which we plan to have a pres ence,"Lei said.

The MIUI, Xiaomi's mobile operating system based on Android, has already attracted milli ons offollowers in 23 countries, which laid the foundation for Xiaomi's globalization.

C.K. Lu, a senior mobile device research analyst at Gartner Inc, said Xiaomi has an oppo rtunityto penetrate markets especially in Asia, where users tend to be more cost- conscious. "But alack of patents can be an issue for it (Xiaomi) when leaving its home market," Lu wr ote in an e-mail.

Cultural challenges, limited experience in international operations and a shortage of talen t arelikely to be major obstacles to achieving the desired result, said Duncan Clark, chair man ofinvestment consultancy BDA China.

Xiaomi raised about $90 million in the latest round of funding on Oct 20. The investors inc ludedTemasek Holdings, International Data Group and Qualcomm Inc. Xiaomi's total fund raisingamounts to $131 million. Lei said Xiaomi would not go public in the next five years. "If we have an IPO, we may bedistracted from delivering good products," he said.

Lei said he had received no salary from the company, even though he is its CEO.

"I just hope Xiaomi will fulfill my dreams and become a world-class company. Working for Xiaomiis the last job of my lifetime." Online spat hides bigger tensions

Updated: 2012-06-07 08:03

By Shen Jingting (China Daily)

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A Xiaomi Corp employee talks with a customer in Beijing on May 16.Feng Yongbin / for China Daily

It's rare to see two famous Chinese business leaders engaging in a tit-for-tat spat publicly justbecause they are competitors. However, it happened between Lei Jun, founder of Xia omi Corp,and Zhou Hongyi, chairman of the Chinese online security software developer Qihoo 360Technology Co. Both of them lost their tempers and criticized each other on mi cro blogs. On May 15, when Xiaomi released its youth version smartphone at 1,499 yuan ($235), Qi hoo360 announced a partnership with Huawei Technologies Co Ltd to introduce a similar smartphone model at the same price.

The two companies were quickly involved in a war of words. Lei accused Zhou of manipu latingpeople to create malicious information about Xiaomi and disgrace Xiaomi products. The latterdenied all the charges and criticized Lei, saying he feared competition.

The quarrel reflected a wide belief that there is intensified competition in China's smartph oneindustry. More and more outsiders, especially Internet companies, have shown a stro ng interestin rivaling traditional hardware manufacturers in the hope of grabbing a share of thesmartphone market.

China's biggest Internet company, Tencent Holdings Ltd, has released six QQ smartphon es,mainly targeting students, with different mobile phone makers. Baidu Inc, the search e nginegiant, introduced two smartphone models running on its self-developed mobile oper atingsystem.

Alibaba Group, which introduced its first Aliyun smartphone last July, priced at 2,680 yua n,released the second generation of the device priced at 1,499 yuan last month.

The latest newcomer is Shanda Interactive Entertainment Ltd. Chinese media reported S handawas likely to introduce its first smartphone in June, priced at 1,199 yuan.

"Xiaomi could feel pressure because there are many ambitious rivals coming up from beh ind,"said Zhang Yanan, an analyst with the Beijing-based consultancy Zero2IPO Group.

Smartphones, among various mobile devices that are likely to gain in popularity, have the sameimportance as software and applications. That's why various Internet companies re gard thesmartphone business as hot, Zhang said.

However, Lei expressed confidence in Xiaomi.

"Xiaomi is unique because it may be the only company in China that has integrated hard ware,software and services from the very beginning. It's in Xiaomi's DNA," Lei said. Com bining thosethree critical parts is also the secret of Apple's success, he added.

In addition, Xiaomi has millions of "Mi" fans, who defended Xiaomi smartphones during L ei'sdispute with Qihoo 360. "Newcomers are not able to replicate Xiaomi's business models as Mifans are considere d loyal. But there are opportunities for some to sell devices to their core fansbecause Chi na is such a big market with widespread interests to be covered," said C.K. Lu, asenior m obile device research analyst at Gartner Inc. 小米科技 — 再现苹果商业神话？

中国互联网元老雷军的智能手机梦

（2012 年 6 月 7 日）

中国日报记者：沈静霆

中国能否出现一个手机企业取得和美国苹果公司一样巨大的成功？对于这个问题，小米科技责任有限公司首席执行官雷军很可能会给出一个非常肯定的答案 —“Yes”。 2010 年 4 月，小米科技在北京诞生，定位是生产高性能、低售价的智能手机。小米手机采取比较激进的定价策略，每部手机价格锁定在 2000 元（317 美元）以下，仅仅是覆盖生产成本。自发布售价 1999 元的小米第一代手机 Mi－One 以来，小米科技便在国内获得了广泛关注。2011 年 9 月 5 日，Mi－One 开始接受网络预定，短短 34 个小时，30 万部手机便销售一空。面对突然的缺货，小米科技不得不立即暂停销售。三个月后，公司重新开始在线供应 Mi －One，但库存的 10 万部手机也仅用了 3 个小时便被抢购完毕。在接受中国日报独家专访时，雷军说希望截至 2012 年年底，小米科技能够售出 500 万部手机。他预测公司全年营业收入有望超过 100 亿元人民币。但小米科技的远景目标是：2016 年单款手机出货量超过 1 亿部。雷军坦言：“我知道这（远景目标）听起来似乎有点疯狂，但我们想去尝试一下。” 位于美国加州库比蒂诺的苹果公司去年卖了 9000 万部 iPhone 手机。尽管目前距离苹果发布第一款 iPhone 手机不到 5 年，但人们普遍认为苹果今年会打破销售 1 亿部 iPhone 手机的纪录。很明显，雷军梦想着小米科技取得和苹果公司相似的成长速度。雷军说，如果一个电子产品真的风行起来，它的扩张速度会非常快，甚至超出你的想象。

顺势而为现年 43 岁的雷军经历多次创业，是中国软件、互联网领域的行业领袖。25 岁时，雷军便成为中国著名软件公司 — 金山软件公司 — 的首席执行官。他 1999 年投资创建电子商务公司卓越网（Joyo.com），并在五年后以 7500 万美元将其出售给了美国亚马逊公司。 2007 年，金山软件有限公司香港上市，雷军随即宣布退休。离开金山公司之后，雷军成为了一名天使投资人，投资了一系列中国著名的互联网公司，包括在线服装零售商凡客、移动互联网浏览器服务商 UCweb 等。雷军早期创业和投资经历为其积累了可观的财富。他没有必要为了生活而工作了。然而，雷军没有选择放松的生活方式，而是又投入到了竞争异常激烈的智能手机产业中。雷军说： “成立小米科技是在正确的时间做正确的事情。” 在雷军淡出业界的时间里，他做了很多深入思考。在他眼里，一个人能够获得巨大成功最重要的因素是他必须总能顺应时代的潮流，否则所有的努力都要付诸东流。 “在金山工作的时候，我工作非常努力，压力很大。但是，我发现一些互联网公司诸如新浪、搜狐等，他们很容易创造财富，并且对于社会有很大的影响力。”雷军回忆说。“我当时为此非常苦恼。” 渐渐地，雷军参悟到一个道理 — 做对的事情远比把事情做对更重要。雷军经常讲一个笑话 — 即使是一头猪，如果它在台风口，它也能飞起来。他用这件事情做比喻是为了说明顺应形势和潮流做事情，成功会变得非常容易。现在移动互联网就是下一个大趋势，因此，雷军下定决心不能错过这个机会。玛丽•米克，一位前摩根士丹利分析师，早在 2009 年就作出预测：五年内，通过移动设备访问互联网的人数将超过通过台式机访问互联网的人数。米克在其 2009 年发布的一份报告指出:“2020 年，智能手机、电子书阅读器、车载电子设备以及游戏机等家庭无线设备销量将超过 100 亿部，那会是届时电脑销量的 10 倍。”她预测这场移动互联网革命会在当今大公司之外产生新的伟大公司。这就为小米创造了机会。雷军希望他的公司未来成为世界 500 强公司，在电子消费品领域与行业内强手如苹果、三星等公司展开竞争。中国拥有世界上最大的手机用户群。如此巨大的市场容量自然成为世界级智能手机公司诞生的摇篮。研究机构 Stragegy Analytics 在一份报告中指出，2011 年第三季度，中国手机出货量已超过美国，成为世界最大的智能手机市场。“中国目前处于世界移动计算最前沿。”Strategy Analytics 执行总裁莫斯顿说。雷军同样对于中国智能手机市场持乐观态度。中国智能手机销量很大，但是相对未来仍然有巨大的潜力。“我预测到 2013 年，中国有三分之二的人口将使用智能手机。”雷军说到。 “这一次，小米应该是做了一件正确的事。”

为什么是小米？小米科技的一夜成名几乎使雷军猝不及防。限制小米手机供货量被媒体指责说小米科技采取饥饿营销策略。尽管一切尽在掌控并稳步推进，雷军承认，小米科技前进得速度比他预想得要快。“我们原本计划 4 年要达到的目标仅用两年就实现了。” 雷军补充说小米科技的成功源于以下三点：首先，小米手机设计理念充分吸取了用户意见；其次，小米卖手机主要通过互联网渠道，降低了渠道费用，最终降低手机售价；第三点原因是最重要的 — 小米科技没有打算通过卖手机赚钱，而是通过提供软件和服务获取利润。 Gartner 公司上海分析师 Roger Sheng 说，小米科技成功的重要原因在于数以百万计的小米粉丝的口碑效应。 “用户仅能通过互联网才能买到小米手机，其他渠道买不到，这就导致网上排队抢购现象的出现。”Roger Sheng 说道。小米手机的目标用户群是铁杆移动设备用户。他们中大多数对于移动设备特别狂热，是这个领域的意见领袖，也乐于推荐朋友买他们认可的手机。小米科技在维护用户关系方面付出了较多精力。除了做智能手机外，公司还推出了卡通人物米兔、制作微电影、生产特殊纪念品，诸如 T 恤衫等。雷军把小米科技成立的日期 — 4 月 6 日，作为小米粉丝年度聚会的日子。今年第一次盛会，几百名米粉从全国各地赶来，相聚在北京 798 艺术中心，一起歌唱、聊天，就像久别重逢的老朋友一样。一些小米追随者甚至为小米手机制作了特别的音乐、视频和配件。程柳，一位来自成都的米粉，说小米手机是唯一打动自己的智能手机品牌。 Frost&Sullivan 公司的电信分析师季宸东说：“小米是第一家以较低价格出售高端智能手机的公司。小米 1999 元的经典版和 1499 元的青春版，一开始就给了市场一个惊喜。” “小米手机清晰的定位在那些收入较少、难以负担超过 4000 元以上高性能智能机的人群，这是一个容易被忽略的市场。”艾瑞公司分析师沈岁说道。

全球化视野雷军说，小米将于今年下半年启动海外销售。相比美国、欧洲等发达国家，小米将把更多的精力放在开发新兴国家市场，如俄罗斯、印度、巴西等国家。 “由于小米手机主要通过互联网口碑相传。我们要进入的市场需要有支持电子商务的友好环境以及成熟的社交网络。”雷军指出。小米手机操作系统 MIUI 是基于安卓开发的智能手机操作系统，目前已经吸引了来自 23 个国家数以百万计的开发者进行应用开发，这是小米建立全球化的根基。 Gartner 高级移动设备分析师 C.K.Lu 说，小米科技在国际市场，尤其是亚洲市场，还是大有机会的。“但是，中国手机厂商成立时间短，往往专利储备比较少，这是在海外竟争中面临的一个主要挑战。” 另外，小米科技在国际运营中缺少经验，并有可能出现人才短缺，这都是它实践国际化战略的障碍，北京 BDA 投资咨询公司主席邓肯说。截至目前，小米科技总共融资 1.3 亿美元，投资者包括淡马锡控股、美国国际数据集团（IDG）、高通等。雷军表示，小米手机未来五年内都不会上市。“如果我们上市了，我们就不会集中精力创造好的产品了。” 雷军说自己没有从小米科技拿过一分钱工资。 “我只是希望小米科技帮我完成建立一个世界级企业的梦想。在小米工作是我一生中最后一份工作。” 配稿：科技界巨头口水战折射手机行业激烈竞争

中国日报记者：沈静霆

两个著名商业领袖在公开空间中恶语相向、互相攻击的情况在中国并不多见。然而，它却真实发生在小米科技有限公司创始人雷军和网络安全企业奇虎 360 创始人周鸿祎身上。他们两个都表现的有点失控，在微博上展开了对骂。 5 月 15 日，当小米发布了青春版智能手机，并宣布售价 1499 元（235 美元）之后，奇虎 360 随即宣布与华为公司联合开发售价完全相同、功能类似的智能手机。两家公司很快卷入了口水战。雷军指责周鸿祎误导用户、散步恶意信息、诋毁小米产品。周则拒绝承认这项指控，并反过来指责雷军惧怕竞争。深层次上，这个争吵反映了一个现象 — 中国智能手机市场的竞争日趋激烈，越来越多的外部竞争者，尤其是一些著名的互联网企业，显示了进入智能手机市场、并分一杯羹的强烈欲望。中国最大的互联网公司腾讯控股和不同的硬件制造商合作，发布了六款 QQ 智能手机，其主要目标用户是学生。搜索引擎领导者百度公司，最近也发布了两款新型智能手机，内置百度自身开发的移动操作系统。阿里巴巴集团在去年七月发布了第一款阿里云手机，售价 2680 元。紧接着，阿里巴巴上个月发布了第二代阿里云手机，售价 1499 元。最新的进入者应该是盛大互动娱乐公司。中国媒体报道说盛大第一款智能手机将于 6 月份正式发布，售价 1199 元。 Zero2IPO 集团北京分析师张亚男指出，小米科技应该能感受到压力，因为有许多有野心的竞争对手在后面追赶。然而，雷军对小米手机充满信心。“小米是唯一的，因为小米从一开始就把硬件、软件和服务融合在一起。这是小米的 DNA。”雷军说道。另一家手机企业做到了这一点的，就是美国的苹果公司。在雷军和周鸿祎争吵的过程中，数以百万计的米粉对小米手机表达了强烈的支持。 Gartner 高级分析师 C.K.Lu 说：“新进入者不可能复制小米的成功，因为小米迷是非常忠诚的。但是，小米的竞争对手也有机会，因为中国市场容量巨大，不同用户的喜好不一样。”