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Rediff.com  » Business » After biting Apple in China, Xiaomi looks to scale up rivalry in India

After biting Apple in China, Xiaomi looks to scale up rivalry in India

November 06, 2013 09:42 IST

After biting Apple in China, Xiaomi looks to scale up rivalry in India

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Sounak Mitra in New Delhi

Most of its mobile phones, which it sells only online, look like Apple’s iPhones -- but are much cheaper.

China’s Xiaomi, after having eaten into the US-based handset giant’s market share on home turf, has now set its eyes on India and plans to replicate its model here, too.

Hugo Barra, who recently came from Android to join as Xiaomi’s vice-president, sounds quite resolute when he says his company’s model, with which it beat Apple in China, will help it garner volume market share in India, too.

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Adrees Latif/Reuters


Image: Shirly Tishler of Israel uses an iPad mini to speak to her family back home as she awaits in line to purchase the new Apple iPhone 5S phone at the Apple Retail Store on Fifth Avenue in Manhattan, New York September 20, 2013.
Photographs: Adrees Latif/Reuters

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After biting Apple in China, Xiaomi looks to scale up rivalry in India

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The trump card, probably, are its price points: It will sell its mobile handsets at around Rs 20,000 -- less than half the starting price of Apple’s phones.

Within two years of the August 2011 release of its first smartphone, Xiaomi’s share of the Chinese smartphone market reached five per cent in the second quarter of 2013, compared with Apple’s 4.8 per cent, according to research agency Canalys.

Barra, in charge of the company’s products and operations in all markets outside of mainland China, recently said India was one of the sweet spots for Android smartphone maker Xiaomi, as the equation of quality and affordability worked well in the world’s second-most-populous country and the third-largest smartphone market.

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Image: A user of Xiaomi uses his mobile phone to take a photo at a launch ceremony of Xiaomi Phone 2 in Beijing.
Photographs: Jason Lee/Reuters

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After biting Apple in China, Xiaomi looks to scale up rivalry in India

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Markets like Russia, Indonesia, Latin America and Thailand are also on Xiaomi’s radar.

Among Xiaomi’s innovative ideas is selling its products only online.

Every Tuesday, at noon Beijing time, it unveils a new batch of smartphones (100,000 units) after analysing user feedback.

Apple studies feedbacks only once a year.

At present, Indians could buy Xiaomi smartphones at its retail website www.xiaomiworld.com.

The company then supplies the product through courier.

A customer can pay through Paypal.

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Image: A collection of Apple smart covers are seen at an Apple store.
Photographs: Stephen Lam/Reuters

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After biting Apple in China, Xiaomi looks to scale up rivalry in India

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These products are also available on some of the Indian e-commerce sites like www.91mobiles.com, www.olx.com, which source these from Xiaomi.

To Business Standard’s specific query on how it planned to sell its products in India, the company did not respond.

An analyst tracking Xiaomi said it might take the general retail route to push products here, apart from selling online.

Sources tracking the company also say it would develop some India-specific low-cost models to take on Indian smartphone manufacturers.

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Image: Lei Jun, founder and CEO of China's mobile company Xiaomi, speaks at a launch ceremony of Xiaomi Phone 2 in Beijing.
Photographs: Jason Lee/Reuters

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After biting Apple in China, Xiaomi looks to scale up rivalry in India

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The company’s latest flagship smartphone, the Mi-3, sold 100,000 units in less than 86 seconds of its launch on the company’s retail website.

If Xiaomi does enter India, it will also face fierce competition from South Korean major Samsung Electronics and home-grown Micromax.

Here, Samsung leads the smartphone market, with a 26 per cent volume share as of the second quarter of 2013, according to International Data Corporation.

It is followed by Micromax (22 per cent).

Apple’s share is below three per cent. Smartphone sales in India are estimated at $35-40 million units a year, compared with China’s 360 million shipments.

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Image: MacBook Air laptops are pictured on display at an Apple Store.
Photographs: Mario Anzuoni/Reuters

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After biting Apple in China, Xiaomi looks to scale up rivalry in India

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According to a Canalys report, India’s smart-phone market has grown 129 per cent in the September 2013 quarter, while the growth rates in China were 108 per cent and globally about 50 per cent.

Xiaomi has its cost advantage but it might also face competition from home-grown companies like Micromax and Karbonn, as most of their smartphones are priced below Rs 20,000.

The company is currently valued at $10 billion while its annual revenue is at around $4.6 billion.


Image: Lei Jun, founder and CEO of China's mobile company Xiaomi, checks his Xiaomi mobile phone.
Photographs: Jason Lee/Reuters

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