Everything you need to know about Chinese tech in one 30-minute video

December 12, 2013
Obsession
Mobile Web
December 12, 2013

At the end of August, Hugo Barra left his position at Google as the man in charge of Android, its mobile operating system, to move to Xiaomi, a Chinese phone manufacturer with big ambitions. This week, he appeared at the Le Web conference in Paris with a presentation that anybody interested in either China or technology—or both—would do well to watch.

In less than 30 minutes, Barra runs through the most significant Chinese tech firms (such as Tencent and Alibaba), what makes them so different from their Western counterparts, and why there’s more to the market than just colossal numbers.

A big takeaway is the importance of cross-functional integration. Barra says Tencent’s messaging app, WeChat, makes his life simpler not only because “literally everyone single person I know, everyone I’ve met in China, is on WeChat” but because the app does everything: messaging, group messaging, Instagram-type photos and even payments, making internationally popular messaging apps like WhatsApp seem paleolithic in comparison. “I don’t use email, I don’t use phone, I don’t use text messaging; only WeChat,” says Barra. Barra also talks about lesser-known Chinese services such as MoMo, an app to find and chat with people in nearby locations; Didi, a taxi-app with voice directions; and Qihoo 360, a company that distributes free security software and has had over 400 million downloads.

The most interesting part of Barra’s talk is in the last 10 minutes, when he discusses his new employer, Xiaomi, a company that receives a fair amount of exposure in the Western tech press even though it remains a relatively niche player even in China, which is the only place it sells phones. Barra was brought on to help take the company global, an expansion he says will initially remain limited to China’s neighbourhood rather than the West.

In Barra’s telling, Xiaomi’s strength lies in taking the best from the world’s biggest tech firms and integrating them into a single model. Xiaomi adopted Apple’s tight control over design and the supply chain, Google’s ability to crank out products at great speed, and Amazon’s focus on making it easy to buy directly from the company. Together, he says, these three things make for a “low-margin business that’s sustainable.” Last year, the company sold 7 million smartphones. It is on track to sell between 18 million and 19 million this year, which is “not higher only because we can’t make more,” Barra said.

The other notable thing about the interview: the somewhat patronizing tone adopted by Barra’s interlocutor, Loic Le Meur, Le Web’s founder. It suggests that some in Europe’s tech world still aren’t taking Chinese firms very seriously. They should start doing so.

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