Xiaomi (loosely pronounced shee-ow-me) is a fairly young company, but in just over three years it has become one of the most important and game-changing firms in Chinese electronics. TechCrunch notes it is now valued at $10 billion, putting its worth on par with Lenovo, the second-largest maker of personal computers in the world.
But while Lenovo sells all manner of computer products, Xiaomi only sells one type - cell phones - and they have taken the Chinese market by storm. In the first half of 2013, the company was behind the top-selling phone in China, the Qualcomm Snapdragon-powered Mi 2S, which beat out Samsung’s Galaxy S4 for the top spot. Leading mobile processor developer Qualcomm, incidentally, is also an investor in Xiaomi.
But Xiaomi doesn’t just have eyes on China. It’s also priming itself for a big international expansion, thanks to today’s industry-shaking hire of Hugo Barra. Barra was Google’s vice president in charge of managing the Android operating system, and his defection to a Chinese firm is one of the most visible Western executive transitions to date. His new role will be as Vice President of Xiaomi Global, a strong hint that his job will involve getting Xiaomi’s products into users’ hands across the Chinese border. In addition to another Google VP, Xiaomi also employs former executives from Microsoft and Motorola.
The most immediate question observers might ask is whether an untested Chinese brand is likely to find success in Europe and America. Consider the acquisition by Lenovo of IBM’s venerable ThinkPad laptop line in 2005. Until that point, no one on our shores had ever heard of Lenovo, and the idea of ThinkPad being separated from the iconic IBM seemed unthinkable. But consumers accepted the change quickly, and within a year, the company had axed the IBM logo and put Lenovo’s in its place. Consumers didn’t flinch.
Xiaomi’s phones will look familiar to any modern smart phone user. They are all sleek, touchscreen models that run on the Android operating system. The company’s president has set Xiaomi’s sales goal for 2013 at 15 million units. It’s been so successful to date that it’s already seeing counterfeiters attempt to copy its devices.
Xiaomi’s business model is to keep quality high and prices as low as possible - an approach that could help them gain recognition as they expand. Reportedly it markets handsets at prices that are just above production costs. This could also work to the company’s favor in cost-conscious U.S. markets, although it will first need to navigate the complex carrier subsidy system. Fortunately for Xiaomi, it now has a number of employees on its roster that know how to do exactly that.
[This sponsored article was written by IDG Creative Lab, a partner of Qualcomm.]
This story, "Xiaomi the money! Who is this mobile company that's poaching Tech's top shelf talent?" was originally published by BrandPost.