“While supply side news stunned Wall Street showing stronger demand for the iPhone 7 than anyone anticpated, we just caught wind of two other pieces of news: one is great news, the other could be catastrophic,” Ophir Gottlieb writes for Capital Market Laboratories. “First, the good, then the bad.”
Talks between India’s Finance Ministry and the Department of Industrial Policy and Promotion (DIPP) have begun and the option of letting Apple open stores without sourcing requirements in the initial years has been floated. The Indian government is expected to allow the tech giant to open its own retail stores in the country without any sourcing requirement for two to three years, according to the Times of India.
“That’s the great news,” Gottlieb writes. “But, Apple Inc. also just received catastrophic news too, from a totally different place. ”
[A] new patent cross-licensing agreement with Microsoft now gives Xiaomi access to about 1,500 of Microsoft’s patents. In exchange, Xiaomi has agreed in exchange to install Microsoft’s Office and Skype software on all the smartphones and tablets it sells. About 90 percent of the 70 million smartphones that Xiaomi built last year were sold in China. UK-based analyst Sameer Singh told Reuters, “This deal might just give them enough of a patent trove to move to Western markets.” – Breitbart
“While the bearish view of this outcome is pretty obvious, it turns out this could be a non-issue,” Gottlieb writes. “The U.S. consumer is no different and there is very little evidence that even if Xiomi makes it to the U.S. that anyone will be interested.”
Read more in the full article here.
MacDailyNews Take: “Stunning?” Sounds like Ophir has a flair for the hyperbolic headline. Hint: If it doesn’t stun, it ain’t stunning.
So, yet another pretend iPhone (this one even more superficially imitative than most) that’s stuck running the fragmented, rarely-updated-hence-insecure Android OS? Yawn.
Xiaomi only gets away with their slavish copying of Apple products because the Chinese courts wouldn’t know trade dress infringement if it drove over them in a tank in the middle of Tiananmen Square.
As for India, get ready, here comes Apple!
SEE ALSO:
Apple loses Chinese smartphone crown to iPhone imitator Xiaomi – August 3, 2015
Don’t be silly, Xiaomi is no threat to Apple – January 19, 2015
Chinese Xiaomi copycat hit with patent infringement lawsuits, sales bans – December 23, 2014
“Stunning news”? Uh. no.
Right.
Because today the iPhone with a secure software OS and curated app store owns the “high end” users.
I doubt the copy cat from China can or will copy the whole ecosystem as the cost is prohibitive.
I’m stunned by how lame the payoff was for that headline lol..
Xiaomi will have its ass handed to itself if it enters non-Chinese markets. Other than shameless copying of handset aesthetics and iPhone-skinned Android screen interface, it will lose the usual race to the bottom for price. Also Xiaomi will expose themselves to litigation for their infringing thievery. Good luck with that one.
MDN should remember that commoditization and ruthless competition kneecapped the Mac in the 1990s. It can happen again.
It was more complicated than that. Think about it. Why didn’t the same thing happen with the iPod or iPhone?
One answer is to identify the decision maker. In the past we had corporate purchasing agents making decisions for others so they bought the cheapest crap possible. With other devices people bought for themselves and opted for higher quality.
It works that way in my family. My son and I buy really good whole bean coffee for ourselves. My wife doesn’t drink coffee so if we let her buy our coffee she would buy cans of the cheapest ground coffee she could find because she only cares about saving money.
In reality, commoditisation and ruthless competition ended up kneecapping the PC industry, not Apple. How many of those leading PC manufacturers from the 1990’s are still doing well?
On the other hand, Apple’s desktops and laptops are currently selling better than ever and hugely profitable.
If a company like Xiaomi flood the market with cheap smartphones, they will kneecap companies like Samsung. As in the days of selling PCs in the 90’s, the challenge is differentiating your product. Selling huge quantities cheaply sounds like a plan until somebody finds a way to do it cheaper than you can. Apple has always occupied the upper end of whatever market it enters and is able to differentiate by offering quality hardware closely tied to a unique and sophisticated operating system. There’s a reason why Apple continues to be hugely profitable in computers, tablets and smartphones, while other companies either make a loss or merely a modest profit – differentiation.
He forgot to set news to stun.
“The Chinese courts wouldn’t know trade dress infringement if it drove over them in a tank in the middle of Tiananmen Square.”
Boom!
If it was WOZ saying AI ! Machines machines! Fight each other! Now that would be stunning.
This much is clear: Some things could happen.
“Xiaomi has agreed in exchange to install Microsoft’s Office and Skype software on all the smartphones and tablets it sells”
Wasn’t it that type of thinking that put Microsoft’s mobile strategy in the crapper in the first place?
Yeah we won’t be seeing people fall all over themselves to get some perennial Office app nor scrambling for Skype in frothing acquisition expectation. That’s Ballmer & Nadella’s sad idea of excitement since those boys don’t exactly get out much (of their old creaky mindset).
Skype is no longer needed for cell to cell. Many other options.
2 things.
1) it proves Microsoft has truly given up on their own hardware as the Office suite was their only real weapon to try to push their own phones by giving a ‘superior’ experience with this ingrained software.
2) much as the Xaoimi phone has copied the iPhone in look I just wish Apple could make theirs look as good on a superficial level first glance. Sadly it looks a good bit more modern without those embarrassing overhangs that the iPhone still sports and makes me cringe at times when I see them so much less obtrusive on increasing numbers of the opposition.
So a phone comes with Microsoft Office. Skype is dying, mostly. At least, it’s dead to me. I have no use for it, and there are no compelling reasons to use it.
Huge yawn…stunning…I don’t think so! When Xiaomi actually invents something, I’ll pay attention. This is good news for M$…Office is really all they’ve got left…this will sustain them awhile longer.
Yep, like all you others I am stunned at this news! Ummm….where did I put that paperclip????
The sooner I get my hands on an iPhone 7, the better.
Why did Xaoimi need access to the MS patents? This smells like a setup for a bait and switch maneuver. After selling several million of the newest model phone, Xaoimi will release the very rare OS update then Boom … there are several million Windows phones on the market. It is the only way MS will get back in the game.
These guys are just shameless whores. Nobody should listen to a word they say. First he says there is news that could be “catastrophic”, then sums up by saying that it could end up being a “non-issue”. Unbelievable!!!
The creativity of China on display. <-That's a joke.