Xiaomi’s price cut defended and publicity event lowdown.

by Frank Tu 0

This week’s blogging news sees Xiaomi’s massive price cuts defended, JD.com promoting themselves on a motor scooter and the bitter rivalry between the major players Tencent and Alibaba/UCWeb being played out in various short articles.

Xiaomi’s CEO Lei Jun was in defence mode on his microblog this week; trying to persuade people that the huge price cut was not a last ditch attempt at meeting its own sales expectations. Xiaomi has cut the price of its third generation model by 25%, and this is rumoured to be because of the need to clear excess inventory and give the firm a chance of meeting their target of selling 60 million smartphones in 2014. Lei’s blog responses were apparently amused by the insinuations but there was no direct denial to any of the claims except to say that Xiaomi is aggressively expanding capacity to meet demand. Although with the huge competition from the many new high quality and cheap smartphones, it seems plausible that Xiaomi are beginning to feel the strain and possibly take steps to compete more effectively.

JD.com spent the week waxing lyrical about its annual promotional event which took place on June 18th; featuring some memorable photographs of JD’s founder Richard Liu delivering products around Beijing on a motor scooter. The first event of this kind took place in 2010 and this year JD reported its order intakes had doubled from last year’s figures. Liu’s personal blog was strangely silent regarding the promotion, but other JD executives were sufficiently indulgent about it on their microblogs. Vice President Xu Lei, apart from hyping JD’s own promotional event, pointed out the other companies who used June 18th as a day for promotion. Suning and Alibaba representatives were tweeting about their own events so it seems June 18th is becoming a major sales event for all.

Also, there has been much cynicism regarding the role of Tencent in bringing about a record fine for piracy for rival company Alibaba in relation to the recently acquired UCWeb web browser. It has been reported that Tencent was a major force pushing for the fine of 260 million yuan. He has been roundly criticised by executives of both Alibaba and UCWeb, which seems a little odd given that piracy is something that harms all of the big players and all stand to benefit from harsh sanctions in the end.