Xiaomi Buys Part Of Kingsoft For $68M
Xiaomi has announced to put money into games and software by buying 2.98 percent of Kingsoft for HK$527 million, which is roughly $68 million.
Kingsoft is a Hong Kong based company which started as a PC games developer company, but now the company also produces security, productivity, and enterprise products too. It is valued at $2 billion.
Xiaomi, the four-year old Chinese handset maker, has lately experienced huge success in sales through its affordable smartphones such as Redmi Note, as well as top notch flagships like Mi3. Their huge number of sales made them world’s third largest smartphone company after Apple and Samsung.
Xiaomi dubbed as “Apple of China” has been expanding since its debut. The company has invested in number of hardware-related startups, such as Midea and wearables startup Misfit. But this deal with Kingsoft is company’s first investment in software and services domain.
It indicates that Xiaomi is looking to lay grounds for becoming a software and services company by starting with producing games service, security features and other mobile services for its customers.
Last year, Xiaomi beat Samsung in China to become country’s top smartphones seller. Few months after that, its popular mid-range phone Redmi 1s became world’s 4th best selling smartphone.
Apart from hardware deals, Xiaomi was also reported to be planning to spend $1B in online video content for Smart TVs.
Now Xiaomi has smartphone as its core products, but also creates smart homes products such as air purifier, blood test device, smart TV and streaming box. According to TechCrunch, Xiaomi’s VP of international Hugo Barra revealed that the company is looking to invest in India, particularly for startups that offer mobile services and e-commerce.
Considering its investments in software and services companies, we can speculate that Xiaomi is on its way of becoming next Apple or Microsoft. Although it is quite difficult to beat a company which is expected to become a trillion dollar company, Xiaomi does carry the potential if they go on to achieve successes just as they have.
Xiaomi CEO and co-founder Lei Jun is also founder and chairman of Kingsoft. The investment in Kingsoft is expected to be completed at the end of January.
Featured Image: [ChinaFotoPress for Getty Images]