Xiaomi Inc’s (小米) entry into the notebook industry next year would only have a limited impact on Asustek Computer Inc (華碩), as Xiaomi is not experienced at promoting sales through traditional retail channels, people familiar with the matter said yesterday.
“Compared with Xiaomi, Asustek is experienced at working with offline retail channels to promote notebook products, and it also has clear strategies in regional markets,” a source told the Taipei Times.
The source’s remarks came after reports said that the smartphone maker is planning to launch its first notebook priced at 2,999 yuan (US$466.40) in April.
The Chinese-language Digitimes and Next Magazine yesterday also reported that Inventec Corp (英業達) would be producing Xiaomi’s first notebook computer in China.
CHALLENGES
Asustek entered the smartphone business last year and the firm views Xiaomi as its top rival in the market.
As Asustek’s smartphone business still only has a limited sales contribution to the company, Xiaomi’s entry into the notebook industry could pose challenges for Asustek’s laptop business, analysts said.
However, the source sees the situation the other way around, saying that while Xiaomi might be doing well in China’s e-commerce sector for smartphones, it would not have the same advantage when dealing with offline channels for notebook computers.
Instead, Xiaomi is likely to lose its price advantage competing head-to-head with China’s Lenovo Group Ltd (聯想) or Asustek in retail stores, the source said, adding that a requirement for continued investment into retail channels would increase Xiaomi’s costs.
Asustek CEO Jerry Shen (沈振來) on Nov. 5 was quoted by China’s Tencent Holdings Ltd (騰訊) as saying that Xiaomi would face challenges if it attempts to enter the notebook computer business through traditional sales approaches.
However, if Xiaomi is able to leverage its e-commerce expertise in the notebook business, its entry might positively stimulate the industry, Shen said.
Asustek chief financial officer Nick Wu (吳長榮) yesterday told the Taipei Times that the company remains open-minded about the Chinese smartphone maker joining the notebook industry next year.
“Asustek has decades of experience in the PC industry, and we are optimistic that we can maintain our competitiveness in the market,” Wu said by telephone.
SALES FIGURES
Asustek yesterday posted its highest monthly sales in the company’s history last month, due to growing shipments of notebooks, smartphones and motherboards.
Consolidated sales grew 2.44 percent annually and 21.08 percent monthly to NT$50.14 billion (US$1.52 billion) last month, according to the firm’s filing with the Taiwan Stock Exchange.
The company said its notebook shipments this month are expected to decline slightly from last month, but that smartphone shipments would continue to increase.
Overall, the firm said the performance of its notebook business this quarter is expected to outpace that of its peers, supported by launches of new notebook models and increased investment on marketing resources and retail channels.
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