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AH Primetime: Chinese Markets, Great For Entrepreneurs

July 15, 2015 - Written By Ricardo Trevizo

China has recently become the birthplace for numerous smartphones, most of which have become rather successful around the whole world. This is mainly due to the Chinese smartphone market being one of the biggest and most prominent when compared to other counties’ such as United States, where launching a new smartphone is almost impossible because of the competition’s dominance. In China, most possible buyers look for the best smartphone available at the most accessible price, which is why any new innovative smartphone launched into the market will at least gain some interest by the public. A lot of new smartphone manufacturers and entrepreneurs, have already launched their own independent smartphone in China, all following the footsteps the country’s largest and most important OEMs, Xiaomi. This Beijing-based company, founded in 2010 has faced an incredible growth ever since, all thanks to the impressive smartphones and relatively accessible prices, which new independent developers and OEMs are closely following their footsteps.

Earlier this year, the Chinese smartphone market shrunk significantly, fortunately Xiaomi has overcame all barriers without any major issues. This has raised some eyebrows and has served as a significant motivator for emerging startups, as the market slowdown has proven to be just too much for other large handset manufacturer. Xiaomi stands strong whilst other OEMs slowly diminish, as the company has strongly clinged to most of its ideologies, innovating and launching new smartphones in a timely manner. According CK Lu, analyst from Taiwan, “It’s not that easy to go bankrupt making phones, but it’s also not easy to be profitable”, this means that whatever Xiaomi is doing is working and could possibly serve as a starting point for new startups.

The price for launching a smartphone in China, is a lot lower than it is in western markets. With as little as a few hundred thousand dollars, entrepreneurs are able to cover all manufacturing costs, with licensing and even off-the-shelf designs; this makes China a dream come true for everyone in the process of launching a new smartphone, which in addition to following Xiaomi’s footsteps, should make the overall process a whole lot simpler… Even if the market they will be competing in will only accounts for one fifth of the market.