Xiaomi stops disclosing annual sales figures(techcrunch.com)
techcrunch.com
Xiaomi stops disclosing annual sales figures
https://techcrunch.com/2017/01/11/xiaomi-2016-to-2017/
8 comments
If their goal is marketshare and then profit, then step 2 is raising the price. Be it slowly (so it is less apparent to avoid bad publicity) or quick (guaranteed uproar, but only once).
An alternative theory could be their business case is related to "Xiaomi Can Silently Install Any App On Your Android Phone Using A Backdoor" [1]. One could come up with a theory their business case is related to that kind of behaviour. Ie. a front for Chinese government.
[1] https://thehackernews.com/2016/09/xiaomi-android-backdoor.ht...
An alternative theory could be their business case is related to "Xiaomi Can Silently Install Any App On Your Android Phone Using A Backdoor" [1]. One could come up with a theory their business case is related to that kind of behaviour. Ie. a front for Chinese government.
[1] https://thehackernews.com/2016/09/xiaomi-android-backdoor.ht...
And even without being a malicious front, you can see them as part of the Chinese economic strategy, moving away from manufacturing to innovation/marketing .
And it looks quite nice: Xiaomi build a phone brand. Uses brand to become a consumer electronic start-up hub(offering startups, Chinese startups, a great supply chain, marketing, IP protection - all the hard things for those startups) as a way to rapidly scale. And they will have better access, and preference to Chinese silicon suppliers(think the esp32 , a great chip, afaik it's only inside Chinese products) rising that industry.
And it looks quite nice: Xiaomi build a phone brand. Uses brand to become a consumer electronic start-up hub(offering startups, Chinese startups, a great supply chain, marketing, IP protection - all the hard things for those startups) as a way to rapidly scale. And they will have better access, and preference to Chinese silicon suppliers(think the esp32 , a great chip, afaik it's only inside Chinese products) rising that industry.
Are you sure it is Xiaomi selling under cost and not the other way around? Prices for other phones are excessive compared to Xiaomi and other Chinese brands with similar specs.
Considering the fact that no other smartphone manufacturer other than Apple and Samsung don't make a profit...
I don't think their business plan to sell things at a loss.
This is a young company with many great engineers and known for their efficiency
This is a young company with many great engineers and known for their efficiency
There is an important supply chain related nuance in my opinion - in the US, distribution channels are critically important - Amazon, Best Buy etc. - but in Asia, this isn't always the case, in fact a flash sale on JD or some vendors stores directly means they can play with skinny margins and sell products. If you are selling something in Best Buy, there is a good chance that there is a 50% markup in many cases which is the customer acquisition cost that Best Buy is charging amongst others (limited inventory holding, logistics etc). Because big box retail doesn't have the same kind of foothold in asia and more direct website purchasing is popular, they are able to seemingly to pull off marketplace magic but the reality is their pricing wouldn't look that different if sold in Best Buy for instance. It still might be cheaper, but it wouldn't be the insane rock bottom pricing you are used to seeing reported on TechCrunch...
Vendors (from Samsung to even clothing companies) make agreements with retail stores to have the same price in shops and online. Otherwise online would be cheaper and retail would refuse to list more expensive SKUs. The only ways to bypass the markup of the distribution network are:
- Go "Tesla" mode: Sell directly online or manage your own distribution – Only works if you pull off a unique product, makes the pricesheet much cleaner (examples: Apple and most hardware startups).
- Use Amazon for distribution to bypass retailers and their markup: That would have worked until 2015, but on one hand it seems no seller would rely solely on Amazon for distribution (lack of foothold of Amazon?); on the other hand Amazon decided to massively dispatch counterfeited products together with merchant-originated ones, casting a doubt on the brand and tainting all their providers together.
To date, it seems like retail remains the safest way to order an item...
- Go "Tesla" mode: Sell directly online or manage your own distribution – Only works if you pull off a unique product, makes the pricesheet much cleaner (examples: Apple and most hardware startups).
- Use Amazon for distribution to bypass retailers and their markup: That would have worked until 2015, but on one hand it seems no seller would rely solely on Amazon for distribution (lack of foothold of Amazon?); on the other hand Amazon decided to massively dispatch counterfeited products together with merchant-originated ones, casting a doubt on the brand and tainting all their providers together.
To date, it seems like retail remains the safest way to order an item...
Can anyone comment on how Apple works with retailers? Do retailers "buy" from Apple (and pay within thirty days of delivery)? Can retailers return iPhones they can't sell without paying a premium?
Sorry I don't know anything about the market. I don't even know if best buy's margin would be public information or if we'd need to make an educated guess.
Sorry I don't know anything about the market. I don't even know if best buy's margin would be public information or if we'd need to make an educated guess.
I don't know the mechanics of how apple works with retailers but honestly all rules are off for them. With respect to Best Buy's margin - its not a flat rate for anyone, its typically negotiated for each vendor based on a great number of things. In general, Apple's ability to bring customers into the store provides massive leverage to them so they can push back on Best Buy pretty hard to get a better deal.
> on the other hand Amazon decided to massively dispatch counterfeited products together with merchant-originated ones, casting a doubt on the brand and tainting all their providers together.
Does this happen even with products "shipped from and sold by Amazon"?
Does this happen even with products "shipped from and sold by Amazon"?
As far as I understand, whether it is "sold by Amazon" or by a third party, they put the same products with the same ID in the same bins. Traceability is thus broken, and whichever origin you've selected, they take it from the same bin.
Now I take the question the other way: Amazon's UI confuses the user about the third party products, which is the opposite of giving clear information about genuineness and traceability. The day it matters to them, they'll proudly say "Not a Third Party".
Now I take the question the other way: Amazon's UI confuses the user about the third party products, which is the opposite of giving clear information about genuineness and traceability. The day it matters to them, they'll proudly say "Not a Third Party".
I don't believe that a large proportion of phones sold by Best Buy have a 50℅ retail markup. If that were the case, you'd expect those models' effective retail prices in China to be ~70℅ of the US retail prices. But they aren't. Brand-name mobile phones retail for roughly the same price in China as they do in the US. (With the exception of iPhones, which are about 20℅ more expensive in China than in the US).
I suspect that Best Buy makes insignificant margins on most cellphones, but makes it up on accessories (and I guess they sell carrier plans as well?).
I suspect that Best Buy makes insignificant margins on most cellphones, but makes it up on accessories (and I guess they sell carrier plans as well?).
I believe I read that Xiaomi has an ecosystem model where they sell phones as loss-leaders at low margins in order to build their brand and capture customers for high margin software. I don't think that's going to work as they don't own the operating system.
It will work there are quite a few alternative app stores that do make money.
Considering that emerging markets sell phones without google play I would go on a limb and say that most android phones sold now come without the play store.
Considering that emerging markets sell phones without google play I would go on a limb and say that most android phones sold now come without the play store.
I think China is the only market where phones are sold without google services. Even when Xiaomi sells to India or Hong Kong, the phones are often "global version" (different ROM), which come with google services because everyone outside China expects them.
Africa, India, Latin America Russia and many super cheap phones in Europe.
This is a great point! Because of google services being blocked in China, the play store is unavailable so people download their apps ('A-P-Ps' if talking to someone in China) via 3rd party sites. Trying to become a substantial app distributor is a nice idea but also very difficult between Apple have a locked down platform and serious competition from antimalware companies and others who already have a solid foothold in this space, but I can certainly see the value in trying.
They have https://en.wikipedia.org/wiki/MIUI, but I don't know if MIUI enables them to sell services or have their own app store.
> They have gone on record before that they're not making a profit on their phones
Maybe not (I actually think they do), but they are making money on phone-plus-services.
Maybe not (I actually think they do), but they are making money on phone-plus-services.
i ordered xiaomi note 2 for my sister and you get what you pay. the rom is completly shit. its full of ads you cannot turn of. and the battery became unusable after only half year. because i ordered it online i dont have any warrany. my sister had to buy a new smartphone. dont just look at the specs when you buy something.
Xiaomi roms don't have ads. You ordered from a third party vendor that had installed their own rom showing ads. This is a problem of their distribution model -- the phones are available internationally only via unofficial third parties -- rather than their product.
You can get them in major European electronics chains, no need any shady reseller. They are pricier than online but you will get clean software and two year warranty while price is still beating closest competition of Lenovo and Honor.
they have ads even in official roms.
and sorry but the roms that xiaomi sells are without play services. the reason for customization. the rom is miui with google services.
and sorry but the roms that xiaomi sells are without play services. the reason for customization. the rom is miui with google services.
There are certain gotchas when importing a Xiaomi phone, one of which is being wary of replacing the software the distributor has put on it with official Xiaomi software. Clearly you didn't do that.
official roms dont have play services, thats why there are those customizations in the first place.
nobody stops you from taking advantage of cheap Xiaomi hardware and then installing Lineage or whatever custom ROM you like there, that's what i did with my two Xiaomi phones and will do in future also with other brands like LeEco, good luck trying to catch me in your ecosystem
though it might work on majority of population without necessary skills to unlock bootloader, install recovery and ROM
but anyway outside China there are Google services even in Xiaomi phones, so their only advantage is in Chinese market where are dozens of app stores
though it might work on majority of population without necessary skills to unlock bootloader, install recovery and ROM
but anyway outside China there are Google services even in Xiaomi phones, so their only advantage is in Chinese market where are dozens of app stores
Even though Xiaomi is most widely known as a smartphone manufacturer, for me it's a fantastic home appliance and electronic accessories maker. They're great value for their price. I've come to own so many of these without even noticing myself:
- A great body weight scale that I use almost everyday, for around 100 yuan (~14 dollars). Has Bluetooth and syncs with your phone. I bought a second one for my mom.
- Four air purifiers. 699 yuan each (~100 dollars). A third or a fourth the price of rivals from traditional home appliance makers. Two for me and two for my mom. They also have a great app that connects them to my phone. These are such great values that my friends and colleagues bought ~10 more in total based on my feedback. Given the terrible smog in Northern China it's no surprise they've been out of stock for weeks this winter.
- One 10,000mAh power brick for my wife. I think it was less than 15 dollars. Many of my friends use Xiaomi's battery pack too.
- Countless cheap Lightning cables.
In addition to these, I'm also planning to buy another two of their products for the coming Chinese New Year:
- A water purifier for 1999 yuan (~290 usd). Good design that let's you change filter without fuss. Also connects to phone.
- A robot vacuum for 1699 yuan (~250 usd). Two of my friends bought it and feedback has been positive. Also has an app, naturally.
- Another air purifier.
My point is that if you're a watcher of Xiaomi, you have to look beyond the phones.
- A great body weight scale that I use almost everyday, for around 100 yuan (~14 dollars). Has Bluetooth and syncs with your phone. I bought a second one for my mom.
- Four air purifiers. 699 yuan each (~100 dollars). A third or a fourth the price of rivals from traditional home appliance makers. Two for me and two for my mom. They also have a great app that connects them to my phone. These are such great values that my friends and colleagues bought ~10 more in total based on my feedback. Given the terrible smog in Northern China it's no surprise they've been out of stock for weeks this winter.
- One 10,000mAh power brick for my wife. I think it was less than 15 dollars. Many of my friends use Xiaomi's battery pack too.
- Countless cheap Lightning cables.
In addition to these, I'm also planning to buy another two of their products for the coming Chinese New Year:
- A water purifier for 1999 yuan (~290 usd). Good design that let's you change filter without fuss. Also connects to phone.
- A robot vacuum for 1699 yuan (~250 usd). Two of my friends bought it and feedback has been positive. Also has an app, naturally.
- Another air purifier.
My point is that if you're a watcher of Xiaomi, you have to look beyond the phones.
They also have $20 fitness tracker with app.
highly-regarded Chinese outfit
It wasn't so much a matter of being "highly regarded" as it was being overly hyped. I am not sure if it was the media’s fault or Xiaomi’s own PR efforts, but the nonstop “Steve Jobs of China” headlines and fawning articles about the hardware and Miui were over the top. When Xiaomi was listed #2 in Technology Review’s “50 Smartest Companies” of 2015 (behind Tesla, 1) I was flabbergasted — yes, they are nice phones (we own a Hongmi and a another larger-screen phone whose name I can’t remember) but there are lots of problems with Xiaomi’s Android implementation, and the low-cost strategy is clearly not sustainable.
Design can only take you so far in the Android universe, as the HTC example demonstrates (2). Undercutting competitors on price is also not a long-term strategy.
1. https://www.technologyreview.com/lists/companies/2015/
2. http://www.recode.net/2016/4/12/11586042/htc-10-looks-to-mak...
It wasn't so much a matter of being "highly regarded" as it was being overly hyped. I am not sure if it was the media’s fault or Xiaomi’s own PR efforts, but the nonstop “Steve Jobs of China” headlines and fawning articles about the hardware and Miui were over the top. When Xiaomi was listed #2 in Technology Review’s “50 Smartest Companies” of 2015 (behind Tesla, 1) I was flabbergasted — yes, they are nice phones (we own a Hongmi and a another larger-screen phone whose name I can’t remember) but there are lots of problems with Xiaomi’s Android implementation, and the low-cost strategy is clearly not sustainable.
Design can only take you so far in the Android universe, as the HTC example demonstrates (2). Undercutting competitors on price is also not a long-term strategy.
1. https://www.technologyreview.com/lists/companies/2015/
2. http://www.recode.net/2016/4/12/11586042/htc-10-looks-to-mak...
I don't think they are overhyped at all.
I own a Mi4i, converted from a Nexus 5. My biggest worry was unfounded, I ended up loving MIUI. It is, in my opinion, way more usable than vanilla android and they seem to do significant updates once every few weeks. The design is very nice, its routinely assumed Im using a high-end smartphone. The screen is great, battery is ok (relative to the times), its occasionally laggy with lots of apps open but nothing that really annoys.
Of course the pricing is absolutely insane, cant comment on them as a business. Worth saying that while Im not an a typical user I would pay double the price before even considering another brand.
I own a Mi4i, converted from a Nexus 5. My biggest worry was unfounded, I ended up loving MIUI. It is, in my opinion, way more usable than vanilla android and they seem to do significant updates once every few weeks. The design is very nice, its routinely assumed Im using a high-end smartphone. The screen is great, battery is ok (relative to the times), its occasionally laggy with lots of apps open but nothing that really annoys.
Of course the pricing is absolutely insane, cant comment on them as a business. Worth saying that while Im not an a typical user I would pay double the price before even considering another brand.
As a proud owner of a redmi note 3 replacing my nexus 5, I couldn't be happier. Love the MIUI.
Yup, I own a Redmi 3S Prime for ~$130. It's a great value phone and doesn't lag. MIUI is extremely slick and easy to use. I persuaded four of my family members to go for Xiaomi phones and they couldn't be more happier.
Counterfeit Jobs is just the media being the media. Lei Ju dressed like Steve and presented like him. They have done nothing remotely innovative as a company. Their phones looked like duplicates of the iPhone and the Samsung Galaxy lineup for years, which from my understanding, is why they haven't entered the U.S. or other markets yet.
If you actually used any of their devices you'll quickly see that "done nothing remotely innovative" is an utter lie.
You are correct, I can point to countless articles showing what they have done without actually using them. Blatant design and OS ripoffs is what I can take away from it. "AN APPLE OF ANDROID", "Xiaomi's Mi Pad Is Almost a Spitting Image of the iPad Mini", etc. Show me an article or two where they have been innovative, please.
Their battery banks are some of the best on the market.
i used samsung galaxy for a couple of weeks. and no, mi does not copy samsung certainly.
samsung is loaded with utter crap default apps. asus follows this path with so many uninstallable default crapps.
i never rooted my mis and always update community roms. the default crapps are minimal.
mi phones (and miui) are ways up from others. it takes effort not to notice. buy one, play with it a couple weeks, and u never want to use other android phones.
samsung is loaded with utter crap default apps. asus follows this path with so many uninstallable default crapps.
i never rooted my mis and always update community roms. the default crapps are minimal.
mi phones (and miui) are ways up from others. it takes effort not to notice. buy one, play with it a couple weeks, and u never want to use other android phones.
They're in a weak position long term because they don't have a cohesive strategy. It's a shotgun approach of trying many diverse offerings and hoping something will take off. The problem with this is lack of focus, not being able to rally the company around a singular mission.
If you look at all of their businesses most are either low margin or undifferentiated or both.
They have a big asset tied up in their patent portfolio. They need to make use of it, either defensively i.e. enter a western market, or as a platform to focus more of their efforts around fewer initiatives and become truly great at something that makes money. It's hard to be innovative at many things at once.
If you look at all of their businesses most are either low margin or undifferentiated or both.
They have a big asset tied up in their patent portfolio. They need to make use of it, either defensively i.e. enter a western market, or as a platform to focus more of their efforts around fewer initiatives and become truly great at something that makes money. It's hard to be innovative at many things at once.
I bought an Amazfit Pace after Pebble went down. Boy is that thing broken: That smart watch has glitches showing the _time_, notifications are broken beyond repair - some plain don't show up and most others are duplicated and the watch soft reboots/crashes a lot.
I can see why the parent company might want to slow down a bit..
I can see why the parent company might want to slow down a bit..
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it could be that mi phones are so good that people like me and my wife do not want to buy a new replacement.
i dropped my mi 1S on hard ground one year ago. the screen glass was torn, but not detached; however, the touch is not affected at all. the face camera still works but the pic is blurry due to torn glasses covering the face camera.
last week my 4yo son threw my wife's mi 2. screen torn (much worse than mine, but the scars do not cross important areas like front camera), touch ok, camera ok.
i asked her if she wants a new phone? she flatly said no. it still works great.
i had a chinese no name brand tablet. dropped wooden toy on it, screen torn, touch broke, 'mouse' jitters. luckily pointers still functions with normal mouse (use utb-otg) after detaching the touch sensor ribbon cable.
so yeah, xiao mi phones are robust and ours are 24/7 abused. they (mi 1s and mi 2s) still get great build even when the prices are just around $100. the second thing less abused in my house is my lenovo yoga (ultra-slim laptop). oh wait, probably the most abused is my cisco router.
we do have more high end phones like motorolla and asus; however, they are not used as much as the mis. not because they are more expensive so we care more. it's just painful to use say asus. it's power hungry, and data hungry, often betrayed us on critical moments. we just don't use it. the asus z5 is now used by my 4yo son to watch youtube.
on last note, we like that our mis do not have a brand printed facing us, unlike the ASUS or SAMSUNG. i never like printed brand on my personal stuffs just to show off. printed brands on inside, not to show off, are ok.
i dropped my mi 1S on hard ground one year ago. the screen glass was torn, but not detached; however, the touch is not affected at all. the face camera still works but the pic is blurry due to torn glasses covering the face camera.
last week my 4yo son threw my wife's mi 2. screen torn (much worse than mine, but the scars do not cross important areas like front camera), touch ok, camera ok.
i asked her if she wants a new phone? she flatly said no. it still works great.
i had a chinese no name brand tablet. dropped wooden toy on it, screen torn, touch broke, 'mouse' jitters. luckily pointers still functions with normal mouse (use utb-otg) after detaching the touch sensor ribbon cable.
so yeah, xiao mi phones are robust and ours are 24/7 abused. they (mi 1s and mi 2s) still get great build even when the prices are just around $100. the second thing less abused in my house is my lenovo yoga (ultra-slim laptop). oh wait, probably the most abused is my cisco router.
we do have more high end phones like motorolla and asus; however, they are not used as much as the mis. not because they are more expensive so we care more. it's just painful to use say asus. it's power hungry, and data hungry, often betrayed us on critical moments. we just don't use it. the asus z5 is now used by my 4yo son to watch youtube.
on last note, we like that our mis do not have a brand printed facing us, unlike the ASUS or SAMSUNG. i never like printed brand on my personal stuffs just to show off. printed brands on inside, not to show off, are ok.
I bought a Redmi 3s phone about 3 weeks ago after my Nexus 4 dropped in water and I'm still very impressed with its build quality, the MIUI shell is great and what I really like is the battery life. There's no chance I'll ever buy anything else while such great and cheap offerings exist in the market.
Too much competition from other Chinese phone maker and too fast diversification?
I imported a Xiaomi Mi 4C a month or two ago for €100 (it still sells around that price). For that price you get a fantastic 5" screen, the same Snapdragon 808 chip / 2GB RAM as the €300 Nexus 5X, a more than decent camera and great build and battery life. The heavily customized OS is surprisingly tasteful and useable, and is being regularly updated with features and Android security updates. In addition the Android core of their custom OS will even get a promised update to Android 7.0 this year, despite the phone being on the market for nearly two years. I'm very happy with it.
If you look at the EU market in the same price category, you can only get utter crap. Specs and general usability of phones in the same price category do not compare, and you need to go well over €250 to find comparable phones. Even then, the software support of those competing devices still does not compare, mostly.
Given that, I do not believe for a second that Xiaomi is able to sell this phone sustainably for this price. Keeping costs low through a focus on Asian markets and low-overhead distribution costs does not magically remove the component and development costs that go into such a device for them to be able to make a profit on it for €100. What's more is that Xiaomi has several models with a 'low-end' price that have mid-to-high-end specs. You see that Xiaomi has quickly won popularity in the tech savvy west for their bang-for-buck value in smartphones despite usually not even selling there.
This is all great for the consumer, but evidently it cannot be (and is not) great for Xiaomi. They wanted market share and they got it, now it's time for the next step.