‘Xiaomi is Internet firm, not hardware maker’ Chief of rising Chinese smartphone-maker underlines software, Internet content

Top management of Xiaomi, a rising star in the consumer electronics world, said the Chinese smartphone-maker could differentiate itself from its top two global competitors ― Samsung and Apple ― by seamlessly integrating its software and Internet content with hardware. 

“From the beginning, Xiaomi has considered the mobile phone to be a converged gadget of software, Internet services and hardware, not just as a simple device (for communication),” Xiaomi CEO Lei Jun said in a meeting with South Korean ICT Minister Choi Yang-hee, who visited the firm’s headquarters in Beijing Friday. 

Lei, who founded Xiaomi ― often called “the Apple of Asia” ― with eight software experts from Google and Microsoft in 2010, led the tech firm to the top spot in the Chinese smartphone market and to third place in terms of global smartphone shipments in the first quarter of this year. 

“Developing hardware is just a part of Xiaomi’s businesses, and the driving forces behind those devices are its software and Internet content,’’ he said.

Xiaomi has its own operating system, MIUI, for mobile and home appliances such as TVs. It also runs an app store and the online payment solution Alipay.

“Xiaomi’s smartphone and TV operating system MIUI, which supports 27 languages, now has 85 million users,” the CEO said.

ICT Minister Choi Yang-hee (right) and Lei Jun, chief executive of Chinese smartphone maker Xiaomi, have a discussion session at the Chinese firm’s head office in Beijing, Friday. (ICT Ministry)

Aiming to beef up its software capacity, Lei hired a slew of software and tech experts including Hugo Barra, a former vice president of Google.

Having shipped 26 million smartphone units in the first half, the Chinese smartphone-maker is aiming to sell 60 million this year. 

The Mi2, the firm’s second flagship model and a hit product, helped catapult the Chinese smartphone-maker into the world’s top three, with more than 17 million units sold worldwide since its release in 2012. 

Actively reflecting customers’ voices and needs in product development and services was a contributing factor for Xiaomi’s explosive growth during the past years, Lei added. 

Even though Xiaomi is working closely with Korea’s electronic parts suppliers such as LG Display and Samsung, he said the company has no plans to partner with Korean firms to create a new OS ecosystem.

Global electronics-makers Samsung and LG Electronics are currently devoted to making their own operating systems, Tizen and Web 2.0, respectively, to wean themselves off Google’s Android.

For those Korean firms aiming to tap the Chinese market, he advised that they should first find local partners who are familiar with the Chinese market environment.

By Kim Young-won (wone0102@heraldcorp.com)

S. Korea, New Zealand initial bilateral FTA

South Korea and New Zealand on Monday initialed their free trade agreement (FTA), concluded last month, that will eliminate import tariffs on more than 90 percent of goods traded between them.

The FTA was initialed in Wellington by South Korean Deputy Trade Minister Choi Kyong-lim and New Zealand Deputy Secretary of Foreign Affairs and Trade David Walker, the Ministry of Trade, Industry and Energy said.

Initialing of a free trade pact means that the two parties confirm every word on each page is final and will not be subject to changes before the official signing, according to the ministry.

The English version of the FTA, whose negotiations were concluded Nov. 15, was made public immediately after the initialing ceremony at www.fta.go.kr.

The ministry said the two countries have agreed to officially sign the agreement within the first half of next year. It will then be sent to the respective legislatures for approval before it can go into effect.

Under the pact, New Zealand will eliminate its import tariffs on 92 percent of all shipments from South Korea, in terms of their value, immediately after its implementation, and completely remove all tariffs on South Korean products within seven years.

South Korea will reciprocate by removing tariffs on 96.4 percent of shipments from New Zealand over a 15-year period following the implementation of the deal. The two sides have agreed to exclude some products from the deal, mostly agricultural goods, such as rice, that are considered most sensitive in South Korea.

In 2013, bilateral trade between the two countries came to US$2.8 billion, making New Zealand South Korea's 44th-largest trading partner and South Korea New Zealand's 41st, according to the ministry. (Yonhap)

New shopping trend pushes Korean shoppers to splurge on Black Friday

South Korean shoppers joined the Black Friday shopping craze this year as local shoppers eagerly embraced the growing shopping trend of buying directly from overseas retailers, a poll showed Thursday.

Some 55 percent of 1,000 Koreans who opted for overseas direct shopping during Black Friday season said they spent more than the US$200 duty-free ceiling, according to the survey by global cashback operator EBATES. 

The figure marks a sharp rise from the first-half result where only 2 percent of the respondents said their purchases have exceeded the $200 threshold, the company said. Comparable results from last year's Black Friday season were not available.

Black Friday, which falls on the day following U.S. Thanksgiving, is considered the official start of the holiday shopping season and offers a myriad of discounts. The sales period includes Cyber Monday three days later.

More than 75 percent of the shoppers said they were willing to pay additional tariffs for overseas direct buying, while a whopping 99 percent said they plan to continue the shopping habit even after Black Friday.

Under local customs regulation, shoppers who order from U.S.bretailers are mandated to pay a tariff rate of roughly 5 to 13 percent for fashion, cosmetics and food products that exceed the

$200 limit. A higher tariff is fixed for luxury products such as mobile phones, golf clubs and watches.

The data also showed that Black Friday shopping has settled down as a common shopping habit, with 41 percent of the respondents saying their Black Friday shopping amount accounted for more than half of their overall online spending last month.

The poll comes as overseas direct buying, or "jikgu" in Korean, is gaining popularity as a way to save money. A growing number of people are putting cost over the multi-shopping process and the longer shipping period after finding out they can buy imported products and even those by South Korean household names, such as Samsung and LG, at a lower cost.

The trend has also reshaped the local retail industry. While South Korea does not celebrate U.S. Thanksgiving, key retailers such as Lotte and Shinsegae introduced special promotions themed under Black Friday and Cyber Monday as part of efforts to capture shoppers breaking away.

South Korea's imports made via jikgu ballooned nearly five-fold between 2009 and 2013, according to the customs office. The amount reached $718 million in the first half, forecast to break last year's $1 billion record. (Yonhap)