Manu Jain, MD of Xiaomi India, stated that that the internet company business model had taken seven years to be developed in China, and therefore is likely to take a few years to take shape in India too
Chinese smartphone manufacturer, Xiaomi, seems to be looking at expanding its India business, foraying into the Internet space. Top executives from the company say that Xiaomi intends to replicate its China business model, monetizing various services, including entertainment and finance, apart from its goal of attaining a leadership position in the smartphone segment. This goal was visible in the recent launch of the Chinese company very first premium smartphone offering in India, the Mi Mix 2, on October 10.
Manu Jain, MD of Xiaomi India, stated that that the internet company business model had taken seven years to be developed in China, and therefore is likely to take a few years to take shape in India too, a country where Xiaomi entered only three years ago. In China, the company offers diverse services, through an all-inclusive business model, which it plans to recreate in India as well.
What Xiaomi Seems to be Planning
At the Mi Mix 2 launch event, Mr. Jain had stated, “We’re much more than a smartphone brand. Our hardware business is important, as it helps us acquire large number of internet users for our internet platforms like MIUI, Mi finance, Mi entertainment.”
He went on to explain that the company has a “a concrete plan to launch these services in India, we’re carefully evaluating on when to launch these services,” while adding that the “ultimate objective” was to build an internet business and “monetise our internet layer so we can make money from a long term perspective, from our operating system MIUI.”
At present, Xiaomi holds the second position, with Samsung being at #1, in terms of smartphone volumes in India. The primary goal, therefore, is to first gain market share from competitors through its Redmi and Mi handset ranges, which offer great specifications and high quality but are priced much lower than their counterparts from other brands.
The company’s internet business includes Mi Finance, MIUI Interface and Mi Entertainment. Xiaomi already has a model to monetize these businesses, and intends to capitalize on its smartphone users to build its internet business in India.
Where Xiaomi Stands Today
Xiaomi had earlier announced that it has already achieved $1 billion in revenues from India and aims to double that figure in 2018. To do so, the company intends to focus on three crucial aspects, its life cycle in a region, the capabilities of its team and market maturity. This will also help the company with its plan to launch internet services in India.
With its India headquarters in Bangalore, the company has been selling over 4 million handsets each quarter since the beginning of 2017. With the launch of its premium offering, the Mi Mix 2, it will now compete with the likes of OnePlus, Apple and Samsung, which has become increasingly competitive. While the rest of Xiaomi’s handsets are now being manufactured in
India by Foxconn, Mi Mix 2 is likely to continue to be imported from China to be sold in India in the foreseeable future. This, the company, explained is due to some “technical reasons,” which if overcome, could lead to the Mi Mix 2 also being manufactured in India.
With a keen eye on growing in the country and a plan already in place, it only seems a matter to time till the company launches internet services in India.