The upstart Chinese maker of smartphones just hosted its biggest event outside of its home country to introduce a new flagship phone, and it wasn’t in the United States or even Europe, it was in India.
The phone, the Mi 4i, was introduced on Thursday by Hugo Barra, a former Google executive. The phone includes impressive specs and special features in India — like extra language options — and will go on sale April 30 in India, and in May in Hong Kong, Taiwan, Singapore, Malaysia and Indonesia.
As the company’s Lei Jun, Xiaomi’s chief executive, normally does in China, Mr. Barra guided an enthusiastic audience through the phone’s range of features. But for all the attention Xiaomi gives to technical details and its operating system, the denouement came when Mr. Barra announced the price of the phone: 12,999 rupees, or roughly $200, a low price for a flagship device.
While there are a huge number of reasons for Xiaomi, valued at $45 billion after its latest December fund-raising round, not to push into markets like the United States — from potential patent lawsuits to having to develop relationships with carriers — perhaps the primary reason Xiaomi is entering India is because the country looks quite a bit like China several years ago.
India has a huge population with very few owners of smartphones. As a developing country, India’s user needs, from multiple SIM cards to concerns about data consumption, also resemble those of Chinese users.
Most importantly, Indians are expected to buy far more smartphones this year than they did in 2014, according to IDC, the research firm. IDC estimates that the country will buy 111 million smartphones this year and 149 million units in 2016. India is expected to outpace the United States in sales in the coming years.
With the growth of China’s smartphone market slowing, it’s an obvious next stop for a company like Xiaomi. The only problem is other Chinese companies, from the well-known like Lenovo to the unheard of like Oppo, also have the same idea. Beyond Chinese rivals, Xiaomi faces Samsung, which holds top market share in India, and several local Indian companies, most notably Micromax. Xiaomi throwing its weight at India is a recognition that the company will face competition.
“I don’t expect them to have the exponential growth they had in China,” said Kiranjeet Kaur, an IDC analyst.
“But if you don’t keep it as a comparison, there’s a lot of opporuntiy, because India is in that growth phase that China was in two years ago,” she said.
Yet the $200 price point makes the Mi 4i far cheaper than the leading phones from other companies like Samsung, HTC and Motorola. Even so, in India, the Xiaomi phone still ranks as expensive, about double the price of the cheap mainstays of companies like Micromax.
As Mr. Barra said at the close of the event, “Today is a very, very special day for us, it’s the day when we’ve taken the biggest step as a young five-year-old company that we’ve ever done into global markets by putting our best phone forward, by building a flagship phone designed just for India.”
Xiaomi is hoping that will lead people who may pay for a cheaper phone to spend a bit more, while it assumes others who are spending far more on high-end Samsung phones to give it a try. Whether they reciprocate Xiaomi’s attention to India will go a long way to showing whether the company can succeed in a big way outside of China.