Can China’s Xiaomi challenge Apple as the smartphone innovation leader?

[RV_]

Who are these people? Out of seemingly nowhere they are making Android phones and tablets called MiPhone and MiPads. An article in the Washington Post has the skinny:

 

Excerpt:

 

"However, just consider how far, how fast, Xiaomi has come since it was founded in 2010. The company only released its first smartphone in 2011. Its first tablet was only released in May 2014. And, last spring, the company re-branded itself as “Mi” in order to appeal to a wider global audience ahead of a big international push. (Because, admit it, “Xiaomi” wasn’t exactly the easiest name to pronounce if you were a native English speaker).

 

As a result of this rapid growth, the company is now projected to sell over 100 million smartphones in 2015. More importantly, the company’s valuation has ballooned, rising from $4 billion in June 2012 to $10 billion in August 2013 to $45 billion this December. According to billionaire investor Yuri Milner (who has an extensive stake in Xiaomi), the company could easily more than double in value once again, to $100 billion. That’s a big milestone. By way of comparison, Chinese IPO superstar Alibaba now has a valuation of over $260 billion and Facebook has a valuation of just over $225 billion.

So that’s where we are today. Xiaomi may not currently rank as one of the world’s most innovative companies, but it does get props for its slick marketing campaigns, rapid growth, and online sales prowess. It’s been touted as an up-and-coming Chinese tech company that might follow in the footsteps of Alibaba. And, indeed, people are already starting to speculate about a Xiaomi IPO, perhaps as early as 2015. Xiaomi is also actively working to address one of its innovation weaknesses — a relatively thin patent portfolio — by working to double the number of patent applications it files every year.

 

However, even with twice the number of patents, Xiaomi won’t be able to challenge Apple unless it’s first-to-market with a radically new genre of product. In others words, for Xiaomi to challenge Apple as an innovation leader, the company needs to come up with more than just cheap, high quality smartphones boasting a lot of great specs – it needs to come up with something groundbreaking like the iPad (not just a me-too product like the MiPad). And that’s just what the company hopes to launch in 2015. According to a statement by founder and CEO Lei Jun, a new “flagship product” is coming in January 2015."

 

Much more in the article here: http://www.washingtonpost.com/blogs/innovations/wp/2015/01/02/can-chinas-xiaomi-challenge-apple-as-the-smartphone-innovation-leader/?wpisrc=nl_innov&wpmm=1

 

Then I went to their website and their screen sizes/processor speeds for the prices, about $250.00 are awesome bang for the buck. Go here and read about their phones, tablets, gadgets! Wow!

http://www.xiaomiphone.com/xiaomi-phones/xiaomi-redmi-note-4g.html

[Jack Mayer]

Lets see how they innovate.... I'm all for competition unless it is subsidized by the government to capture market share.

 

On the innovation front.....well, not so much innovation going on these days by Apple. In fact, they are barely keeping competitive in many areas. I'm waiting......

[TheDuke]

Unfortunately it's biggest screen appears to be 7.9 instead of the 10 inch.

Clever naming though, Mi Pad. Watch for law suits.

The big plus is the 64gb model for only $50 more for a total of $349 compared to Ipad for $749.

I assume it uses Android for the OS?

Another confusion is that on the order page, it states 7.9 while the Specs say 5 inch.

 

I wonder how that new innovative?? Health App is doing for Apple?

[Alie&Jim's Carrilite]

It will be interesting to see what operating system it uses. Not long ago, the Chinese government mandated a wholly owned/made/used chinese operating system for the products that were being sold in China. I bet this is the first step.

[RV_]

Beats me on OS. They just appeared to me yesterday and got my attention for the first time in the article linked to above. we saw the market dominance reversal pretty fast between Apple on top and now Android far in the lead today.

 

I doubt an Apple lawsuit, regardless of their deep pockets, will have any effect on their MiPhones and MiPads. It is the same as if Apple used the last two letters of their name and named their phone LePhone and LePad. Which in lower case looks like IE (Internet Explorer) - lE.

 

Besides the last precedent was a Chinese national who copyrighted the name Tesla in China in 2005, two years after Tesla began to be heard of here in 2003. Tesla lost and had to "buy" their own name if they wanted to use it in China. And that was the exact name. This isn't even close, and is a shortened version of their name. I'm sure China would welcome as much revenue as Apple is willing to thro away on it. And if they tried here and in Europe, I would bet the only outcome would be wealthier law firms.

 

I just see them doing today's phones at half the price. Tomorrow who knows. But we will find out as this brand isn't going away IMO.

 

Crazy backing valuation in real money too. This one will be interesting to watch. And this month is their big unveiling of a new product.

 

If anyone sees it first do post the link.

 

As far as Apple innovation, they are acknowledging the death of iPod sales but not doing much catch up on non-proprietary ports and connectors. That stuff was squashed in the 80s with both computers and cell phones. Remember when you had to buy from the brand or risk incompatibility issues. Or the multi proprietary cell chargers connectors of just a few years ago? Now all micro USB and soon to change to a new reversible USB. I believe that until Apple gets real about batteries, and ports, they will, like IBM in the early 80s bleed market share.

 

Android is popular because we already have chargers and cables that are used in my Android and in Windows phones, and SD cheap per GB storage and swap easily, as well as all Android and Windows tablets and phones hook up to PC keyboards and mice. Folks aren't lining up like before, and are less willing to buy the latest and greatest from Apple, that for almost a decade has used the exact same components, made in the same factories as everyone else. And they change ODM suppliers to the lowest bidder at least annually if not quarterly like all the other vendors of Chinese, Korean, and Taiwan PCs, Phones, and tablets.

 

I mean none of that as disparaging. Just know your history. Blackberry was on top and almost overnight was gone. Nokia was the undisputed leader in quality and innovation in smart phones and phone OS'. Now they are gone, bought by MS, and now are called Lumia not Nokia. MS has remained the undisputed leader in enterprise desktops with 85-90% market share. But in all devices, when including phones and tablets, their world market share is just over around 4%.

 

Tablet sales for all brands have slumped because of folks NOT running out to buy the latest and greatest. Most folks I know locally here are still running old first gen iPads or their kids are. Phones are more visible. But what do you think happened to the never Apple folks in computers and laptops when the only tablets that were popular were from Apple and Samsung? And within a couple of years ASUS came in with Androids that beat the top two.

 

Microsoft should take off this year in both phones and tablets now that they have them unifying in unannounced ways with 10. Apple is moving towards keeping computers and mobile devices separate but allowing them to hand off. They sell proprietary devices after all. An innovation that only respond to mobile full Windows PCs in tablet form factor, that do everything in one device, and share it all on One Drive. All this without selling our info to third parties when we opt out. To me, that says Google will fade slowly as Apple and MS provide more privacy as they do today. Smart TVs and Blu-ray players have been in my house for years before Google's failed TV, Apple's TV that never got off the ground, and the current two leading devices, the Amazon Fire and Roku. I have both because they were on sale for less than half retail. My Blu-ray is easier to use for Netflix by far, but did not have Amazon Prime thus my foray into Roku. Then FireTV. They are great if you have unlimited bandwidth, and want more variety. My ten bucks a month and about the same for Amazon gives me more good TV and movies than I could watch non-stop in any lifetime today. See, I'm about to switch to only over the air network TV, and drop cable TV, in favor of just streaming for the rest. Many others are doing the same.

 

But folks still don't realize that the SD micro card, and the great camera coupled with the standard USB and HDMI connectors, with a removable/replaceable battery is what lost their dominance in phone sales. Most folks don't want limited devices that are throw away when the battery dies. Apple did not sell a camera or they'd not have put one on the iPhones and iPads. They were, and are, about a following that wants perceived prestige, the exclusive club. The folks who wore Rolex watches back in the day who needed the best chronometers, now get better accuracy from a five dollar Wal-Mart watch. Rolexes are a badge of wealth, not accuracy today. So they've only lost their accuracy crowd, only the conspicuous consumption folks are still there. And those who already own one. Regularly cleaned a Rolex will last as long as we choose them to. I own several watches and my stainless Fossils are my favorites for everyday, and my plastic simple one for yard work, a plain dial metal dive watch style with plastic band. Looks new and has stood five years of abuse. Japanese quartz which are a bit better than Chinese movements when I bought it.

 

My point is not pro MS or anti Apple. I admit to anti Google bias. I'd like to see Apple take half the market and MS the other half. And compete on who offers the most privacy. My early pride and joys were my Hi8 Sony Camcorders with water proof cases. My Android phones were, and my Windows phone is, far superior HD for home video. It is also better than my 14megapixel still and video camera by Olympus with its 24X optical zoom. I am now just a snapshot and home video taker. The phone is always with me, no planning or prep, it is at hand. No need for a $1500.00 camera and $2500.00 Broadcast quality camcorder. Those lusts are gone. The artists still need them, no doubt.

 

Just like we ditched our cameras and camcorders, because they are now integrated very well into our phones and tablets, and much more portable, so will non touch and proprietary connectors for the same hardware as everyone else get ditched. And there will be the loyalists there too. My PC has thunderbolt connectors as well as USB3, and it is a 2012,early 2013 model. Almost three years old today. I keep buying USB peripherals that do the same for me at 1/5 the price. I admit to wanting the perfect hybrid tablet and unless the new HP 13" hybrid scales down and uses direct connection to the keyboard cover like the Surface Pros, instead of the Bluetooth ones they are using more in their newer hybrids, it may very well end up being a Surface Pro. For now I'm happy with my Venue 11 Pro. Awesome HD IPS screen.

 

So folks I am rooting for Apple, MS, and Linux if it separates from the theft of data, by the unread or uncomprehended EULA model of Google, and finally comes out with a phone and tablet with their own Linux standardized UI. I believe in "TANSTAAFL" and if privacy is not an issue Android can be ideal for some in the future. But I see a reversal of the stranglehold biz is trying to wrap around communications here in the US. They are failing elsewhere. Besides, isn't it a little late to not buy anything made in China? Like all our computers of any OS, and almost all of our Phones. Y'all do know Korea is buying from China too, yet still has some factories of their own. They are where Japan was in the late 90s when only Fujitsu still made their own computers and devices.

 

I think most of us we aren't stuck not wanting to invest time and money into a new system. But we do tend to avoid a learning curve. Computers are commodities. Like vehicles, they are all operated pretty much the same. And some make it longer than others. But in computers they are obsolete the minute they get to the end user. Not wanting that to be true doesn't change the fact that it is.

 

And now, these guys coming up in the market. The tablets are steady at about $599 for good new systems that used to cost $1200.00. Phones at about $500-600.00. Looks like that is about to change. Hope they offer a Windows phone model too.

[Max Signal]

I think you are ignoring the elephant in the room . With the Chinese government backing them. Does the US Government even give them a real shot at the US Marketplace . The have shut down other Chinese companies in the past in the technology sector.

[skp51443]

The US market may not be a goldmine for them but China, India and the Pacific rim countries are a huge phone market with a whole lot of folks that want a cheap but functional setup. The big bucks per sale are here and in Europe but when you look at the total number of units sold a lot of cash is sitting on the table for manufacturers that hit the price/performance sweet spot for low income users.

[RV_]

Umm, Gord. You do know that all iPhones and all of the rest with the exception of some Samsung models are Chinese made phones right? How about if China decides to do like Russia did with Rocket engines that no one here makes except SpaceX today. The answer that the ULA gave was laughable. They assured us the program was OK, they bought a two year supply. What? What about saying they would build our own here. No one was going there.

 

We sold our manufacturing first to Japan in the 50s and 60s, then when their standard of living came up and their labor was no longer cheap we went to Korea to build our TVs, washers, refrigerators, audio and video gear. Remember that cheap brand Goldstar. Today when I ask folks if LG is like Goldstar and folk say not even close. LG stands for Lucky Goldstar - same company. When Korea's standard of living came up and their labor was no longer cheap everyone went to Taiwan for cheap labor and when they got to a good standards of living and no more cheap labor, they, along with Korea, Japan, and the US companies started buying from China.

 

Our manufacturing firms let our workers go and off shored everything. Now wanting to off shore ownership of their companies to Ireland and a few other tax havens to avoid paying taxes to the country that gave them the opportunities to succeed. Yet they use our infrastructure to deliver the goods that they now only are middle men for taking their toll.

[Max Signal]

Umm, Gord. You do know that all iPhones and all of the rest with the exception of some Samsung models are Chinese made phones right? How about if China decides to do like Russia did with Rocket engines that no one here makes except SpaceX today. The answer that the ULA gave was laughable. They assured us the program was OK, they bought a two year supply. What? What about saying they would build our own here. No one was going there.

 

We sold our manufacturing first to Japan in the 50s and 60s, then when their standard of living came up and their labor was no longer cheap we went to Korea to build our TVs, washers, refrigerators, audio and video gear. Remember that cheap brand Goldstar. Today when I ask folks if LG is like Goldstar and folk say not even close. LG stands for Lucky Goldstar - same company. When Korea's standard of living came up and their labor was no longer cheap everyone went to Taiwan for cheap labor and when they got to a good standards of living and no more cheap labor, they, along with Korea, Japan, and the US companies started buying from China.

 

Our manufacturing firms let our workers go and off shored everything. Now wanting to off shore ownership of their companies to Ireland and a few other tax havens to avoid paying taxes to the country that gave them the opportunities to succeed. Yet they use our infrastructure to deliver the goods that they now only are middle men for taking their toll.

Their are not Chinese based companies and Chinese government backed. Look how the US government shut down Haweii from getting a real foot hold in the US market . There is precedent here.

[RV_]

Gord,

No doubt. But the point I was making is that the suspicion of implanting spy backdoors in their devices was withdrawn when the US was found to be diverting shipments of US routers bound overseas and changing their firm/hardware to add a backdoor. http://www.wolfradio.net/2014/02/08/nsa-diverted-computers-and-laptops-from-shipping-facilities-to-install-spyware/ All Fabrication plants (fabs) in China, be they Intel chip fabs, Foxconn iPhone Fabs, or any number of other cell phone manufacturers and computer manufacturers, are all Government sponsored in a communist country, by virtue of existing. If any refuse to do the bidding of the government they are gone/taken over. Do you think that having a bunch of execs here in the US has any impact on the products they order from China or any other country for that matter.

 

Stan is right about the overseas market in emerging countries like India, the Phillipines, Thailand, being lucrative enough for any company to thrive government backed or not.

 

Gord, the point I was making is that we are already far beyond the point of the Chinese government not being able to sneak in firmware and even hardware backdoors, in anything from cars to washers and dryers to phones or smart TVs to cable modems and routers. Or to eliminate them while we are looking then go back to putting them in later after passing inspection. Or just doing a few of every hundred. There is precedent on all sides. But we all still do biz there for the cheap and trained tech savvy labor.

 

Making a point that they as we do can plant backdoor devices. Our NSA diversion was not done with the knowledge of the companies involved. They merely diverted shipments and then modified them, then rewrapped them and sent them on. Any shipment in China made back to the US can also be diverted the same way, except it is likely much easier there to keep it quiet. The Huawei debacle may have well been done that way.

 

Our vigilance needs to be shifted from the black ops perhaps to more above boards checks here in the US.

 

But again, it is far too late to suspect Chinese products regardless of the backing for the company, when all products are made there today. Want to wreck the US economy? Refuse the import of any Chinese products or raw materials or parts. Our folks are just middle men anymore. They manufacture overseas, evade taxes by changing their US companies to overseas companies, and then outsource their banking and finally got away with outsourcing customer service to overseas call centers that are barely understandable in many cases. The company execs here just rake off the top and make little to nothing here using American workers, compared to the number of paid employees and/or subcontractors overseas.

 

Huawei may have been exactly as you say or not. But the fact is that the type of espionage you were calling the elephant in the room exists across all products we import, and many we don't are merely price protections like the Solar panels we could buy for ten cents on the dollar from China were it not for the tariffs that protect that industry among others. You deal with circuits and many are made in China and elsewhere for the products you are involved with. How many of the components have been vetted as being 100% free of backdoors? Vetted by who? What kind of tests. Spying, corporate and government, has always been a fact of life, the technology changes is all. I remember when 32 bit encryption was considered unbreakable.

 

I am not saying that it is OK. Just that the time for that alarm passed long ago, long before the Huawei incident.

[skp51443]

Huawei is doing well out of the backdoor scandal, might not be selling in the US but they are touting "No NSA Inside" as a key selling point to the rest of the world.

 

http://www.spiegel.de/international/world/nsa-spied-on-chinese-government-and-networking-firm-huawei-a-960199.html

 

 

In a statement, Huawei spokesman Bill Plummer criticized the spying measures. "If it is true, the irony is that exactly what they are doing to us is what they have always charged that the Chinese are doing through us," he said. "If such espionage has been truly conducted, then it is known that the company is independent and has no unusual ties to any government and that knowledge should be relayed publicly to put an end to an era of mis- and disinformation."

 

http://spectrum.ieee.org/tech-talk/computing/hardware/us-suspicions-of-chinas-huawei-based-partly-on-nsas-own-spy-tricks

 

 

 

The New York Times withheld technical details on exactly how the NSA had compromised Huawei's servers in response to national security reasons cited by the Obama administration. But a leaked NSA "spy catalog" made available on Cryptome, a website that publishes government and corporate documents, does show how the agency had already succeeded in installing software back doors in certain Huawei hardware, such as firewalls and routers, as early as 2008. The NSA catalog also reveals exploits for computer hardware belonging to U.S. companies such as Dell.

"The exploits in the NSA catalog actually mirror what the U.S. has been accusing Huawei of potentially doing to their products," Bumgarner says.

 

 

I'm too lazy to care but someone that did might look into where other brands of networking gear are manufactured, regardless of the sticker on the outside that says "Made in USA" that often only applies to the fact that they screwed the lid down here over a pile of parts made elsewhere.

 

 

Huawei may be doing bad things or may have done them in the past but they are working hard to gain the trust and sell their gear to a lot of other countries. Seems like they are doing a good job of it too, their sales seem to keep growing at a good rate. If the whole "not USA based Internet" takes off they will sell a lot more gear to the folks building it and that isn't going to do Cisco and friends any favors.

[Jack Mayer]

If the whole "not USA based Internet" takes off they will sell a lot more gear to the folks building it and that isn't going to do Cisco and friends any favors.

It is bound to take off outside the US. The US has been on a decline in the networking area for years, and continues to be. Our infrastructure is not great. Our rates are not great. Politicians are messing with technology that they have no idea about. Our engineer prowess is on a major decline. I see nothing but a shift to other parts of the world. That is just my educated opinion, though.

[skp51443]

The "not USA based Internet" is more than avoiding buying US derived networking gear, they are also working on installing data links that do not pass through the US or US allies to make snooping harder, running end-to-end encryption on the links so even if we do use a submarine to install a tap they keep their privacy and aggregating data within the encrypted streams to remove traffic analysis as a tool.

 

If links are established that bypass the US it gives the folks at the ends of the link a competitive advantage when dealing with each other compared to a link that comes here first then links on to the destination. It also gives them the possibility of borrowing the "Great Firewall" concept from China and blocking content flow to and from the US again putting us at a competitive disadvantage.

 

The whole concept of the Internet is based on it routing traffic around errors, that depends on everything being interconnected. Until China put the "Great Firewall" in place for their public users the only places you saw this type of limited interconnection was in MilNet and some other countries military networks. Last time I looked, 20 some years back now, MilNet could be isolated from the Internet by pulling two cables, one on each coast. That lack of interconnection offered a choke-point where filtering, fire-walling and monitoring could be easily done in addition to pulling the cables and isolating MilNet if it was being attacked from the Internet. If other countries control their links and both ends outside of the US they then have the same ability to prevent routing through the US and control/monitoring of what they do allow as China does now.

 

You have to have dealt with foreigners that darned well know we are snooping and that we aren't sharing the snooping results with to know just how bad this poisons relationships. Offering them source code level audit access to the software and firmware and review of the hardware to include chip masks to prove there is no snooping code/circuits in there is a huge selling point outside our key circle of intelligence allies and China is making the most of that.