Quiet has fallen over much of the blogosphere in this week before Christmas, though buzz was lingering around smartphone sensation Xiaomias it wrestled with a patent dispute that threatened to halt its nascent overseas expansion. Xiaomi chief Lei Jun was also full of congratulations for his company as it scored a court victory that partially lifted an order banning the sale of its phones in India. Meantime, Lei’s many friends and admirers were offering their congratulations as Xiaomi’s co-founder celebrated his 45th birthday.
Meantime, another courtroom battle saw the chief executive of online cosmetics seller Jumei International (Nasdaq: JMEI) reacting to a series of class action shareholder lawsuits filed against his firm last week. This kind of lawsuit is quite common, and usually comes anytime bad news causes a stock to suddenly drop. Still, the case was obviously an eye-opener for Jumei CEO Chen Ou, and serves as a good reminder of the many dangers that await Chinese tech firms that list overseas. Read Full Post…
Bottom line: Qihoo’s new joint venture looks like a smart tie-up to promote its software and online services, while Xiaomi’s resumption of India sales looks like a hollow win in its patent battle with Ericsson.
Qihoo, Coolpad in JV
A trio of smartphone stories are in the news today, including updates on major news involving security software specialist Qihoo 360 (NYSE: QIHU) and the ultra-cool Xiaomi. The first headline has Qihoo moving into the overheated smartphone space through a major new joint venture with domestic giant Coolpad (HKEx: 2369). In the second headline, Xiaomi has been allowed to resume selling some of its smartphones in India, after a judge last week ordered it to stop sales amid an ongoing patent dispute with Swedish mobile technology giant Ericsson (Stockholm ERICb). Read Full Post…
Bottom line: The target of Qihoo’s rumored smartphone purchase could be Coolpad, while Xiaomi’s new tie-up with Midea could be followed by similar pairings in a broader drive to develop smart appliances.
Qihoo eying Coolpad?
A couple of big deals are bubbling around in the smartphone space today, led by yet another new tie-up involving smartphone sensation Xiaomi, this time with home appliance maker Midea (Shenzhen: 000333). But the hyperactive Xiaomi is having to share the spotlight with the edgier security software specialist Qihoo 360 (NYSE: QIHU), which is reportedly eying a deal for its own major smartphone acquisition worth up to $1 billion.
Each of these deals has slightly different motivating factors, but the central theme is that companies like Qihoo and Xiaomi increasingly see smartphones as a central element of larger suites of product and services rather than just a stand-alone product. In Xiaomi’s case, the company already counts smartphones as its core central product and is trying to build up an ecosystem of related products and services like smart TVs and air conditioners. Qihoo is eying smartphones as a vehicle for propagating its core software and Internet services. Read Full Post…
Two scandals in China’s tech world were hot topics in the microblogging realm this past week, drawing heated discussion on allegations of copycatting and other unethical business behavior at smartphone sensation Xiaomi and newly listed social networking app maker Momo (Nasdaq: MOMO). The debate reflected the wide range of views on the many dubious business practices like intellectual property theft and violation of business contracts that are a regular feature in China’s corporate business landscape.
In less controversial chatter, computing giant Lenovo (HKEx: 992) was also tooting its own horn loud and clear as it celebrated the 10th anniversary of its landmark purchase of IBM’s (NYSE: IBM) PC business. As a long-time China tech writer it was hard for me to believe that historic deal is already a decade in the past, and it certainly kicked off a drive that would propel Lenovo to become the world’s biggest PC brand. Read Full Post…
Bottom line: Xiaomi is likely to quickly settle a patent dispute against it by Ericsson in India, which could slightly raise its costs but won’t affect its longer term development in the market.
India judge crimps Xiaomi’s global expansion
The global expansion plans of fast-rising Xiaomi may have hit a major roadblock, with word that a court has ordered the company to stop importing and selling its popular low-cost smartphones in India. Xiaomi had been targeting India as one of the main drivers in its campaign to become a major global smartphone brand, and has made a number of major moves in the market this year. But now it will have to deal with this new litigation, which is coming from global telecoms equipment giant Ericsson (Stockholm: ERICb) over patent infringement claims. Read Full Post…
China’s anti-corruption campaign has accelerated into the private sector over the last few weeks, with shares of sportswear retailer Anta (HKEx: 2020) and online video provider LeTV (Shenzhen: 300104) both tumbling after reports emerged that their top executives might be under investigation for illegal activities. In both cases the worries later appeared to be unfounded, but other signals have indicated the movement is indeed creeping into the private sector. Read Full Post…
Bottom line: Xiaomi is likely to settle a series of patent disputes launched by domestic rivals Huawei and ZTE, but will face more similar actions as its profile rises in its global expansion.
Huawei, ZTE point finger at Xiaomi
New reports about a series of patent violation claims against smartphone sensation Xiaomi are casting a spotlight on the kinds of battles this fast-rising Chinese firm may face in its aggressive global expansion. Just 3 years after launching its first models, Xiaomi has come from nowhere to become the world’s third largest smartphone brand, behind only much older global rivals Samsung (Seoul: 005930) and Apple (Nasdaq: AAPL). That rapid rise has caught the attention of older domestic smartphone rivals like Huawei and ZTE (HKEx: 763; Shenzhen: 000063), which are reportedly now threatening to sue Xiaomi for violating their patents. Read Full Post…
The following press releases and media reports about Chinese companies were carried on November 26. To view a full article or story, click on the link next to the headline.
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Tencent (HKEx: 700) To Air HBO In China As Govt Shuts Down Free Sites (English article)
Bottom line: Google is likely to get Beijing’s permission to open a China version of its app store that could launch next year, paving the way for the roll-out of its smartphones in the market.
Google eyes China app store
A flurry of new reports are saying that global Internet giant Google (Nasdaq: GOOG) is planning to re-enter China by opening an app store there, in what would be a major strategic turnaround for the company. The real story of Google in China is quite complex, and to say it withdrew from the market in 2010 after a high profile spat with Beijing over censorship is quite an oversimplification. The more accurate story is one that’s seen Google diversify from its core desktop-based Internet services to an increasingly mobile portfolio that also includes a growing hardware component. That hardware element of its diversification could well be the focal point for a new China foray if the latest reports about Google’s plan to open a China app store are true. Read Full Post…
Bottom line: An anti-corruption crackdown at Baidu is in line with a national campaign, but is unlikely to allay suspicion that the company manipulates search results to benefit itself and advertisers.
Baidu campaign snares 5 for corruption
A new report on an anti-corruption operation that snared 5 workers at Internet search leader Baidu (Nasdaq: BIDU) caught my attention for a number of reasons. At the broadest level, this campaign casts a spotlight on the kind of corruption that is rampant at many Chinese companies, where employees often use their position to earn extra cash by accepting bribes from people they do business with.
The bust is also the latest sign that private companies are joining the growing national anti-corruption campaign led by President Xi Jinping. Last but certainly not least, this move casts a spotlight on some of the less-than-transparent things that Baidu does to earn money from advertisers, who are often eager to pay extra to see their names appear high on search result lists. Read Full Post…
Bottom line: Lenovo’s latest results show its smartphone business continues to gain market share at the expense of profits, and it would be better advised to focus on building a strong brand to increase customer loyalty.
Lenovo smartphones post health sales gains
The latest results for leading PC maker Lenovo (HKEx: 992) don’t look too rosy, even as the company’s smartphone business continued to outperform the global market. There are quite a few pieces to this puzzle, which means the longer-term outlook for Lenovo’s smartphone business is still unclear as the overheated market undergoes a much-needed shakeout. The outcome of this story will be crucial to Lenovo’s future, since the global market for its core PC business is stagnating and even starting to contract as consumers gravitate to a newer generation of more mobile, specialized devices. Read Full Post…
