Monday, August 4, 2014

China's XIAOMI overtakes SONY in smartphone market share. April-June 2014.

                                                                                Xiaomi Mi4
China's Xiaomi has overtaken Sony in smartphone market share for the first time, reflecting the rising popularity of cheaper Chinese models made possible through a collaboration with Taiwanese companies.
Xiaomi ranked sixth in the April-June quarter with a global market share of 4.5%, up 0.4 point from the January-March term, according to Taiwanese research company TrendForce. Sony was seventh with a 4.4% share.
The Chinese company is a prime example of a manufacturer focused on volume sales of cheaper devices, generally within the $100 to $200 range. Xiaomi's popular Hongmi handset is priced at 699 yuan ($113).
Of the 10 largest players in the market, six -- including Lenovo in third place and Huawei in fifth -- are Chinese. Combined, they hold about 28% of the global market. The figure has risen sharply from a 16% share in 2012, and is quickly approaching Samsung's 31.4%.
So how did Chinese companies, whose research and development capabilities lag behind Japanese, South Korean and U.S. competitors, become prominent players in such a short period? The answer lies in the development of the Taiwanese industry.
Taiwanese semiconductor maker MediaTek slashed costs for system chips, essentially the core processor for smartphones, by using other company's licenses and partnering with global leader Taiwan Semiconductor Manufacturing. Its products are 30-50% cheaper than U.S. competitor Qualcomm's.
The company also distributes reference designs for smartphones, allowing businesses with no prior experience in the field to easily enter the market.
Hon Hai Precision Industry, also known as Foxconn, led the way in assembling the devices. Other Taiwanese electronics manufacturing services have since followed suit.
Manufacturers of specific components have also grown dramatically. An example is Largan Precision, the world's largest producer of optical lenses used in phone cameras.
The symbiotic relationship between Chinese and Taiwanese companies enabled the mass production of cheap smartphones, shattering the high-profit business model pioneered by Apple and Samsung.
And the trend is accelerating. Taiwanese suppliers are now engaging India in a similar production scheme. The low-priced devices from Chinese manufacturers are being shipped to developing markets in Southeast Asia and South America.
The average smartphone price this year is projected at $259, 14% lower than in 2013, according to U.S. statistics company NPD DisplaySearch. Shipments of phones under $200 will likely soar 43% this year to 440 million units, accounting for 37% of the total tally. On the other hand, shipments of high-end products costing over $400 will likely decrease for the first time, slipping 6% to about 394 million.
The rise of cheap models spells trouble for Japanese smartphone makers. 
Sony, the largest Japanese manufacturer, just lowered its fiscal 2014 sales target from 50 million devices to 43 million. It now expects to break even in the segment, rather than raking in 26 billion yen in operating profit. The company is "pursuing earnings, not volume," according to Chief Financial Officer Kenichiro Yoshida.
On the other hand, electronic parts makers see this trend as a business opportunity. They are reaching out to leading producers of low-price models and are hoping to be included in the reference guides published by MediaTek.

Xiaomi Mi4 4g Lte Smart Phone Snapdragon 801 Quad Core 2.5ghz 3gb RAM 16gb 5 Inch FHD Glonass - Black

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