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Apple’s U.S. Home Turf is now Target for a Debut by China’s Xiaomi

Apple’s U.S. Home Turf is now Target for a Debut by China’s Xiaomi
Employing the same online sales and social media marketing tactics that helped the six-year-old startup become China’s largest privately funded startup, Xiaomi Corp. is preparing to enter the U.S. smartphone market “in the near future.”
The vice president of the company, Hugo Barra, has recently said in an interview that Xiaomi can no longer afford to ignore the world’s largest smartphone arena by revenue. As rivals such as Huawei Technologies Co. erode its market share and growth at home slows, its international expansion is taking on new-found urgency.

“The U.S. is a market that we definitely have in our sights. We will lead with social media, with the channels that allow us to get in touch with the young generation that are enthusiastic about new technology. We are definitely going there,” Barra said on Bloomberg Television.
Xiaomi’s U.S. debut has been signaled earlier also by Bottom of Form
Barra who is entrusted with the responsibility of overseeing the Chinese company’s international expansion programs. However compared to earlier times, a an incursion onto Apple Inc.’s turf is now a better possibility as the smartphone vendor is now in a better position to make that launch.
In a deal with Microsoft that may smooth potential legal tangles over intellectual property as it pushes abroad, the Beijing-based company announced the acquisition of nearly 1,500 technology patents from the U.S. IT giant in June.
However there is no timetable for a U.S. launch, Barra said, for Xiaomi whose plethora of products include smart bikes and rice-cookers. The online platform, the preferred sale method for Xiaomi, is already used by it to sell products such as earbuds and fitness bands to Americans.
“The U.S. is a very important market for any consumer electronics and lifestyle brand, certainly for us as well. Obviously we’ve got to time things carefully,” Brra said.

But breaking into a market that is clearly dominated by Apple and Samsung Electronics Co. could be somewhat of more than a problem for But Xiaomi. Telecommunications carriers such as Verizon Wireless and AT&T Inc., a sale channel with which Xiaomi has limited experience, also has a large control over the smartphone sales in the U.S. American consumers are being increasingly targeted by rivals such as Huawei and ZTE Corp.
“The technology bar in the U.S. is much higher than in Xiaomi’s current major markets, which means it takes a lot more to get into that market,” said Nicole Peng, China research director of Canalys, a consultancy. The cost effect9iveness and the ec0nomics of such a move would also have to be considered by the company. “It will not make sense for Xiaomi to enter a market that is not profitable," Peng said.
India, a country with over 1.2 billion people on the cusp of a smartphone boom, is the  largest overseas market for Xiaomi for now. The online market in India is growing “very very well” and has been Xiaomi’s primary focus in the Indian market, Barra said.
Xiaomi needs a win in India. Local competitors like Huawei, Oppo and Vivo is steadily taking awa market share from it. A fall of 38 percent from a year earlier was noted for Xiaomi shipments which touched 10.5 million smartphones in China in the second quarter, said a areport this month by IDC.
However claiming that the figure was inaccurate, Barra said that Xiaomi shipped just under 7 million units in June alone.


Christopher J. Mitchell

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