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Business News/ Companies / Xiaomi on track with 2015 plans
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Xiaomi on track with 2015 plans

Chinese electronics goods maker brushes off legal troubles, is more optimistic about next year

The Delhi high court in an interim order had restrained Chinese mobile maker Xiaomi as well as online retailer Flipkart from selling mobile phones in India that run on the technology patented by Swedish telecom giant Ericsson. Photo: ReutersPremium
The Delhi high court in an interim order had restrained Chinese mobile maker Xiaomi as well as online retailer Flipkart from selling mobile phones in India that run on the technology patented by Swedish telecom giant Ericsson. Photo: Reuters

New Delhi: Despite recent hurdles Xiaomi Technology India Pvt. Ltd has faced in its fast growing market, the electronics goods maker said it is on track with its 2015 plans.

The Delhi high court in an interim order had restrained Chinese mobile maker Xiaomi as well as online retailer Flipkart from selling mobile phones in India that run on the technology patented by Swedish telecom giant Ericsson. However, the court allowed Xiaomi to import and sell communication devices after the company filed an appeal.

“It (the case) does not impact our plans in any way and we are even more optimistic about 2015 than we were in 2014," said Manu Jain, country head of Xiaomi. “We are back on track with our sales as well as targets for the next year."

The company has to give an account of all devices that are being imported and sold in the country until the next hearing due on 4 February, Jain said.

Xiaomi can only sell devices that use chipsets that have been imported from Qualcomm Inc., a licensee of Ericsson.

Xiaomi will not be able to sell its Redmi Note 3G model until the matter in court is resolved, according to Jain. All the other devices from its portfolio in the country will be available, he said. “We do not see any major impact on consumer confidence due to the recent events," Jain adds.

“We will be bringing the entire product portfolio from televisions to phones to all other devices as planned earlier. Our endeavour is to reduce the lead time between the launches in China and India," Jain said.

Currently there is a lag of two-three months from the time a product is launched in China till the time it is introduced in India. The company intends to reduce it to four-six weeks, the minimum time that will be required to customize the products according to Indian requirements.

Xiaomi, known as the Apple of China, is expected to launch its Mi TV in India by second half of 2015 and is already in talks with Indian partners for content partnerships. The company wanted to launch it even before but it faced delay as Mi TV requires an ecosystem for content and stronger after-sales service network. The company is also figuring out last-mile delivery challenges.

Xiaomi, which has five exclusive service centres in the country, plans to grow it to 100 in 2015.

The company is also close to starting its research and development centre in Bengaluru. “We will be hiring a lot of people in 2015 for our R&D (research and development) centre. We have already seen a place and the work is in progress," said Jain.

Xiaomi is also upbeat about launching its own e-commerce website to sell its product. It is expected to launch the website within six-nine months and is in talks with four-five partners. It will continue to sell on Flipkart.com.

“We are trying to understand the FDI (foreign direct investment) regulations and do not want to do anything that violates the spirit of law," Jain said in a telephone interview.

Xiaomi (pronounced as Shiao-Me), which sells directly to customers via online shops and with minimal marketing spending in order to keep its prices competitive, chose to enter India in partnership with India’s largest e-commerce company, Flipkart.com, due to the logistics and payments challenges in the country.

India and the Philippines are the two markets where the company has taken a different approach.

Xiaomi India will also invest in the local start-up ecosystem, much like the company does in China, according to Jain.

“We will partner with start-ups to build local technology, for instance, small features using existing platforms, such as theme store, different applications and services," he adds.

The firm had sold over half a million mobile phones by October since its launch in July. It has so far imported close to 800,000 units of Redmi 1S, a cheap smartphone, and 120,000 units of its flagship Mi3 phone. It makes available close to 65,000–100,000 phones in India in a month, the company said.

According to a Reuters report on Monday, Xiaomi Corp. raised about $1 billion in a new funding round led by All-Stars Investment Ltd and included Yuri Milner’s DST and GIC Pte. This round values China’s largest smartphone vendor at $45 billion, the report said.

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Published: 23 Dec 2014, 12:28 AM IST
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