Nobody can ever think that China could overtake U.S. in the technology market, but Xiaomi has already emerged as the third-best smartphone maker in the world, and its headquarters is based in China. Presently, the smartphones of Xiaomi are selling like hot pancakes in the Chinese market, and in the international locations the company has started doing business. But, Xiaomi has still the most important task left in its history –Â invasion of U.S. markets where Apple (AAPL, Financial) happens to be the market leader. However, the Chinese firm has been making strides in the smartphone domain that might be worth discussing and that is mentionable while speaking on the competition its offering to the tech giants such as Apple and Samsung (SSNLF, Financial) in the smartphone sector.
Flying high in the sky amid existing rivals
According to research done by IDC, Xiaomi is currently ranked as the third-largest smartphone vendor and has had a stellar performance in the past two years. In fact, the company has been able to capture a large market share by producing low-cost smartphones which offer features to users that are normally expected from high-end smartphones. This is like the unique selling proposition of Xiaomi in the face of intense competition to win over more market share in the near future.
The company has also positioned itself well in the phablet and tablets space, which aids in acquiring some of Apple’s or Samsung’s market share in the high-end smartphone category.
Many tech analysts have opined that the Mi Note and Note Pro from Xiaomi’s workshop could ideally compete with Apple iPhone 6 Plus and Samsung’s Galaxy Note Edge as the features offered are nonetheless less attractive than what is being offered by the two tech giants. The Chinese firm is interested in enticing customers with the phone features and the price tag which is economical and matches the wallet. Recently, it has released the phablet which is lighter and thinner with a better camera than both the iPhone 6 or the Note Edge.
The phablet features the Snapdragon 810, 8 core processor with speed of 2.8 GHz. In comparison, the Galaxy Note Edge showcases a 2.7 GHz Quad core processor and the iPhone has an A8 chip, 64-bit M8 motion co-processor. The operating system of Xiaomi’s phablet is also the latest edition of Android 5.0 Lollipop while the Note is equipped with Android 4.4 KitKat and iPhone 6 Plus has the iOS 8 version.
As per the management strategy the phablet is priced around $533, which makes it cheaper to both the iPhone 6 Plus priced nearly $749 and Galaxy Note Edge priced around $799.
In the low-end category the Redmi 2 has created ripples in the smartphone market which has rich potential of growth as per IDC data. Remarkably, the Chinese tech giant has seen a whopping growth of shipments last year in the low-end smartphone market of 441.6% year-over-year. This makes its market share stand at 7%, which is just a percent away from Lenovo which held 8% market share, while Samsung remains the leader at 17.2% share in the low-end smartphone market.
Diversifying into better avenues
Last month, Xiaomi raised around $1 billion in fresh funding which propped up its valuation to $45 billion. The raise in equity could propel the company to go ahead to improve its global presence as 90% of its revenue is currently from China and as its doing very well in the Nation; it’s high time it should diversify into other geographical locations as well.
Sources have confirmed that the company is trying to build its presence in new regions such as Russia, Mexico, India and Brazil for catering to the affluent middle class of these countries. Such a promising venture taken up by Xiaomi is to invade unknown markets and garner quick market share to compete with Apple and Samsung better in the smartphone segment.
Diversification could be the basis of sustaining a stable revenue stream, and thus it’s investing in cementing its dominance in ecommerce by investing in online video service Baidu Inc. (BIDU, Financial), Chinese online video platform IQiYi and one of China’s biggest video sites Youku Tudou. This manner, Xiaomi is trying to follow Apple’s footsteps where Apple fortified its user base through its iTunes and App Store.
Last word
As Xiaomi has been growing really fast in terms of global shipments, it still has some more time to go for completely taking over rivals such as Apple and Samsung in the smartphone market. But, yes, its multi-faceted "just for you" devices are already creating a lot of hype in the smartphone arena and dominant players like Apple and Samsung are gradually starting to face the heat. If Xiaomi is successful in garnering market share across the globe in a few years, it might become an obvious threat to the top smartphone players across every category.
