​Xiaomi's Lei Jun plays with chip giants in the palm of his hand?

Yesterday, a piece of news about Xiaomi and MediaTek suspending their cooperation sparked a war of words in the industry. Although I am in a period of painful reflection in my life, I have to stay up late to express my personal opinion to set the record straight. If you think my opinion is reasonable, please give me a thumbs up.

First of all, I don’t agree with this news and the fact that many people have mentioned that Xiaomi is facing a supply chain dilemma. Why do I say that? I think I just need to answer one question!

For any of the world's leading mobile phone manufacturers, what kind of relationship is ideal with chip manufacturers?

I think the best answer is to give examples. At present, the models of Samsung, Apple and Huawei are the most ideal (ZTE and LG can also be included). How is it ideal?

That is, they have certain chip self-development and self-supply capabilities, and at the same time, chip companies such as Qualcomm, MediaTek, Spreadtrum, Marvell, etc. are cross-suppliers of their different product lines. At this time, for terminal manufacturers, firstly, it is most beneficial for them to form a multi-vendor competition supply, and secondly, self-developed chips are a good competitive weight, which is very beneficial in new product development, patent disputes and long-term development.

So, for Xiaomi, which is already ranked third or fourth in the world, it is natural for it to form the same situation of competing with chip companies as the above-mentioned companies.

So, if we look back at the development history of Xiaomi mobile phones over the past three years, and at the cooperation with Qualcomm, MediaTek, and the recent cooperation with Unigroup, we can see how Lei Jun has done what is best for himself step by step in the game with chip giants.

It can even be said that Xiaomi's superb methods have allowed it to play with chip giants at its fingertips!

I remember when Qualcomm invested in Xiaomi, Qualcomm China CEO Wang Xiang told me that Xiaomi's business model was worth a try, and it might have unexpected results. In fact, Xiaomi was a seemingly inadvertent but very important move by Qualcomm, that is, a pioneer in the rapid development of smartphones, and an important move for Qualcomm to occupy the commanding heights of the mobile consumer field with the "Snapdragon brand". It is precisely because of this that Xiaomi's first four products all use Qualcomm's most advanced chips, and Xiaomi's business model and Qualcomm's strong support have also made Xiaomi phones quickly popular with high cost performance. This forced other manufacturers to follow up quickly, which triggered fierce competition and overall explosion in the Chinese smartphone market in the past three years!

But no matter what, Xiaomi's competitiveness in the high-end market is still very limited. Therefore, the sales of early products were not very good, and they relied more on the business model to make a name for themselves in the market. For Xiaomi, if it continues to be tied to Qualcomm, there is also a problem, that is, Qualcomm cannot always give you too much support. After all, Qualcomm faces all mobile phone manufacturers. Once the entire smartphone market explodes, Qualcomm will take care of more and larger companies. Therefore, the support for Xiaomi will not be the same as before, and there will not be much difference in product prices. At this time, Xiaomi's so-called high cost performance is difficult to maintain.

At this time, Xiaomi no longer needed to rely on Qualcomm. Therefore, when Xiaomi launched Xiaomi 3, it made a clever layout. The first Xiaomi 3 TD-SCDMA version used the NVIDIA Tegra 4 processor, and the baseband chip came from Spreadtrum instead of Qualcomm. At that time, some people even broke the news that NVIDIA offered a more competitive price than Qualcomm. There are two meanings in this. One is to tell Qualcomm that I have other options, and the other is not to directly adopt MediaTek's solution to avoid over-stimulating Qualcomm. But it can be seen that Xiaomi has taken the first step in supplying multiple manufacturers.

Of course, the result of this was the end of the honeymoon cooperation with Qualcomm. Later, when launching the Unicom and Telecom versions of Xiaomi 3, the so-called 8X74AB series of farce occurred!

Afterwards, in order to give shareholders confidence and expand the market scale, Xiaomi had to increase its volume by making low-end mobile phones, so it introduced the Redmi and the like. At this time, the selection of chips is very important, such as whether to use cheaper MediaTek or Spreadtrum products, or continue to use Qualcomm's 400, 200 series. At this time, Xiaomi took a solid step towards multi-vendor supply, that is, to change the platform and start using MediaTek products. It can be seen that the change of platform of Xiaomi Mi 3 has already marked a crack in the cooperation between Xiaomi and Qualcomm. The Redmi mobile phone launched by Xiaomi later played a role in the final blow, completely breaking up Qualcomm and Xiaomi. I remember that Su C once reported this matter extensively and received special care from Xiaomi.

Of course, everyone knows a lot of things that happened afterwards. Whether it was Qualcomm's lesson or other reasons, it is an indisputable fact that Xiaomi's 4G products were difficult to produce, which also made Xiaomi slow down in 4G. Although its product sales have hit a record high, people who know the inside story should know the origin of this achievement.

On the other hand, Qualcomm also encountered a problem. In the past few years, under the guidance of the Xiaomi effect, domestic mobile phones have set off an arms race, competing to launch flagship phones. Although the market is booming, Qualcomm found that the life cycle of the chips it spent a huge amount of money on research and development has been greatly reduced, and the price is even more difficult to maintain. Therefore, Qualcomm also intends to slow down the launch cycle of the latest products in the Chinese market after 801, and is more considering giving them to international first-line brands or some domestic companies with higher-priced products such as OPPO first, in order to enhance their product value and extend their life cycle. For example, the launch of 805 on the market is more cautious.

Therefore, this can be said to be a double whammy for Xiaomi. When 4G lightning hit, Xiaomi had lost its previous momentum. By the time Xiaomi NOTE 4G was released, the competition in 4G had actually entered a new era, including the maturity of MediaTek's 4G solution, which greatly lowered the competition threshold of 4G. More competitors came, and 4G fell into a situation of chaos. On the other hand, Huawei, because of HiSilicon, could quickly deploy 4G products around the world. The story of Honor fighting Xiaomi is getting more and more exciting!

It is necessary to briefly talk about the feud between MediaTek and Xiaomi. I think it is mainly because MediaTek finally hopes to develop into high-end with the help of 4G, but on the one hand, Xiaomi has brought sales to MediaTek, but it has also made MediaTek's strategy of advancing into high-end a distant prospect. Many of Xiaomi's unconventional practices have caused MediaTek a headache, so it is normal to have differences in cooperation.

At this time, we can see that although Xiaomi has formed a so-called multi-vendor supply relationship with Qualcomm, MediaTek, NVIDIA and Spreadtrum, its bargaining chips are still not competitive enough compared with Samsung, Apple and Huawei. In addition, because it has begun to play with chip manufacturers in just a few years, companies such as Qualcomm and MediaTek are also ambiguous towards Xiaomi.

Therefore, on the one hand, Xiaomi must further expand the global market and increase shipments in order to win a higher position among chip manufacturers, thereby obtaining better supply priority and price advantages. On the other hand, it is necessary to make a difference in self-developed and self-supplied chips and learn from several big brothers.

Having said that, I have to say that Lei Jun is a typical master of investment and speculation.

This is reflected in a company that has become quite popular recently: Pinecone.

On November 6, Datang Telecom announced that its wholly-owned subsidiary Unigroup Technology Co., Ltd. and Beijing Pinecone Electronics Co., Ltd. signed the "SDR1860 Platform Technology Transfer Contract", licensing the SDR1860 platform technology developed and owned by Unigroup Technology to Beijing Pinecone Electronics Co., Ltd. for RMB 103 million.

Beijing Pinecone Electronics Co., Ltd. was jointly invested by Xiaomi and Leadcore, with Xiaomi holding 51% and Leadcore holding 49%.

Although it seems like an insignificant cooperation, it actually contains two purposes.

One purpose is as mentioned above. If Xiaomi wants to gain a better bargaining chip and gain more space in the global market, self-developed chips are currently a necessary and effective move. But self-developed chips are easier said than done than making mobile phones. Looking at the domestic market, Unigroup Technology, which has always been tepid, is naturally a good choice. In a sense, the two companies can be said to hit it off. Through the cooperation between the two companies, ultra-low-end SOCs can be quickly launched, so that Xiaomi can layout the market below 500 yuan, thus laying the foundation for Xiaomi to move towards the so-called 100 million units goal.

Another purpose is speculation. At present, the domestic chip or the entire integrated circuit industry is in full swing of an industrial revolution, in which the government plays an extremely important role. The country's cumulative capital of more than one trillion is eyeing every link of the domestic integrated circuit industry chain. Therefore, the two well-known speculators in the industry have joined forces and will surely reap countless rewards in the capital market in the future. This repeats Xiaomi's old path of relying on capital investment to grow rapidly and become stronger.

In the end, what we see is that Xiaomi has initially formed a multi-manufacturer supply relationship with chip manufacturers and has developed its own chips, which is currently the most advantageous layout.

I think that both the previous war of words with Qualcomm and this war of words with MediaTek are processes that Xiaomi must go through in its layout process. They are normal business games and there is no need to interpret them too much!

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.