Daily Management Review

Xiaomi Falls Prey to Abundance of Fakes


The CEO of Xiaomi Lei Jun said that the Chinese company is more likely to be interfered by counterfeit copies of its products.

According to the publication, the Chinese company Xiaomi, which was accused of imitating or even direct copying Apple for years, faced the same problem as Tim Cook’s Corporation.
The CEO of Xiaomi Lei Jun said that his startup has become a victim of its popularity.

- What is our main problem? Too many fakes. If there were no fakes on the market, our sales could have doubled or even tripled, - he said.

Jun was forced to talk about counterfeit products by the situation with external battery for smartphones Mi Power Bank, 14.6 million units of which were sold in 2014 - less than half of the company’s expected figures.

On the one hand, Xiaomi has to cry over spilt milk due to lost profits. On the other - once the producer has got imitators, in a sense, it is a good lesson. Maybe now they will be eyeing less on other people's creations.

Xiaomi is being on the market for less than five years, but during this period it managed to become the largest private start-ups in history and to press Samsung and Apple’s Chinese market and.

No doubt that one of Xiaomi’s success factors, in addition to aggressive pricing, is an imitation of Apple’s design and corporate identity. Even the CEO often appears on presentations in clothing reminiscent of the style of Steve Jobs.

Chinese vice premier Wang Yang said last month that this year the country will make further efforts to combat piracy and counterfeiting.

Lei Jun also said that to expand the range of devices, the company Xiaomi supported 27 start-ups, 10 of which have already released their products to market. Xiaomi itself will focus on the production of smartphones, TVs and routers. According to the head of the company, celebrating the fifth anniversary of the founding, Xiaomi sold 2.7 million of smartphones, 38 thousand of televisions and 770 thousand of smart devices in its online store just in 12 hours.

- Many people argue that the increase in the range of products manufactured by partners Xiaomi, means that the company loses focus. However, this is a big misunderstanding. Xiaomi has three types of products: mobile phones, televisions, and routers. These three products are our core business and we will focus to them for a very long time, - said Lei Jun.

The first Xiaomi smartphone was presented in 2011, and in 2014, the company has taken the leading position of the native market. Xiaomi phones are sold on a budget, but with a very acceptable performance, so they are affordable to even people with incomes below the average.

After the success in China, the company planned to enter the market in India, which today is one of the most promising. However, there the company had to deal with problems, so Xiaomi’s behavior can be estimated as the behavior of a company, which is fighting for its survival.

Now the Chinese manufacturer is in litigation with the company Ericsson, which accuses the Chinese side in the illegal sale of their devices through electronic resources, despite the ban of the supreme court of the city of Delhi.

The company Xiaomi announced that the company has no relation to these sales. Chinese representatives said that the sale is dealt by "gray" organizations that counterfeited Xiaomi products and pose themselves as the original than undermine the reputation of the manufacturer in the eyes of the Indian customers and authorities.

Xiaomi now intends to take legal action against illegal products under its own brand, which is sold at a higher price. By the end of this year, the company intends to place its data centers in India that makes nervous even such a giant like Google.

source: businessinsider.com

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