Following Xiaomi by example

Lei Jun, co-founder of Xiaomi Technology Co., has shown he has big dreams and ambitions.[BLOOMBERG]

I didn’t imagine this day would come so soon - a Chinese company making a splash with new innovation and the industry, media and consumers all raving about it. Xiaomi, China’s electronics upstart that rose from being an iPhone copycat to a juggernaut in smartphones, received Apple-like attention for its recent new product releases, a self-balancing scooter and a smart TV, to its affordable lineup of products.

Scooters and smart TVs are nothing new. But Xiaomi’s smartphone-controlled scooters and smart TVs were all in price ranges affordable to the Chinese working class. The superlight 12.9-kilogram scooter, developed in partnership with Chinese startup Ninebot costs just $314. Ninebot acquired Segway, which created hype in early 2000s with its two-wheeled self-balancing battery-powered electric vehicle, with Xiaomi’s funding. A typical Segway vehicle costs around $6,000.

Consumers went wild and retailers around the world are rushing to win orders from Xiaomi. Department stores are offering to open retail corners for Xiaomi products.

The rise of the Chinese brand is mindboggling. Few in Korea may know Xiaomi. Some will have heard it elbowed out Samsung Electronics to become the top seller of smartphones in China last year. But Xiaomi’s products, from batteries and air purifiers to health trackers, are all high-spec devices sold at less than half the usual cost.

Affordability is not Xiaomi’s only asset. It has built a unique ecosystem, like Apple and Google, to keep customers, securing long-term consumers for new products. The company claims its biggest competitive edge is software not hardware. All ICT companies aspire to run their own ecosystem by offering and updating services on their mobile platforms. Samsung Electronics and Nokia have also tried. But, so far, only Apple and Xiaomi have succeeded. In fact, Xiaomi beats Apple in turning out software updates by communicating endlessly with consumers through online chat platforms. The company is building loyal fans fast by meeting their needs and demands.

One young friend of mine said Xiaomi reminded him of the movie “Kingsman: The Secret Service.” In the movie a megalomaniac villain and Internet billionaire gives away SIM Smart cards for free, granting a lifetime of free cellular and Internet access to anyone with a scheme to make the most of the world’s population to violently kill each other to leave just a select few on the Earth.

The tech genius has planted a violence stimulator in the SIM card and plans to gather the users all in one place and blow them away in a bizarre plot to halt global warming.

Xiaomi is similar in the method of expanding by offering an affordable, smart and mobile system to make inroads into the lives of people in every corner of the world.

Chinese entrepreneurs can be very inventive and bold. People at first regarded Xiaomi’s founder and CEO Lei Jun as a Steve Jobs-wannabe. But his speeches and studies have shown how big the entrepreneur’s dreams and ambitions are. He doesn’t talk about money. He believes that money can shift a innovation-making company’s attention away from users to investors, turning it into a company that works for the interests of its shareholders.

That conviction deters Xiaomi from going public. He aims to please the customers, not investors, to build a consumer-friendly ecosystem. He invests in startup companies and individuals to expand partnership for symbiotic growth. From Lei Jun’s viewpoint, all Korean companies - from big to startups - are all too common and unoriginal. We have become a country envying China for innovative entrepreneurs like Jack Ma of Alibaba and Lei Jun.

In its latest report on “The China Effect on Global Innovation”, McKinsey Global Institute predicted China would transform itself from “innovation sponge” into a global innovation leader in the next decade. It predicted Chinese companies could show the new way in innovations by offering products and services faster and cheaper with global competitiveness. We hardly hear any reports of Korea’s innovations lately.

JoongAng Ilbo, Oct. 28, Page 34

*The author is an editorial writer of the JoongAng Ilbo.

Yang Sunny