The most successful cellphone maker in China, Xiaomi, has announced its long-anticipated arrival in Africa next month by appointing a distributor. The continent has been the fastest growing mobile region for the past five years, and saw Q1 smartphone sales surge to 47%. Known as “the Apple AAPL -6.17% of China” Xiaomi have aggressively grown their market share in China, ousting the iPhone from top-spot by selling slickly-designed Android handsets made from quality components but selling its handsets cheaply by reducing hardware profit margins. Instead, Xiaomi makes money through its apps and games store. Formed only five years ago, the company’s meteoric rise in its home country made it number three in global smartphone sales last year, behind Samsung and Apple. Founder and CEO Lei Jun is, who unveiled expansion plans early this year for the equally fast-growing Indian market, is considered a rock-star entrepreneur in Asia.
Xiaomi has appointed Mobile in Africa Limited as distributor for the 50 countries that constitute sub-Saharan Africa. The company’s president is renowned tech entrepreneur RJ van Spaandonk, most recently executive director of Core Group, which distributes Apple in 14 countries in sub-Saharan Africa. “I think Xiaomi is currently the one of the most exciting mobile internet brands. It is very well suited to the needs and income levels of the emerging middle classes in Africa,” says Van Spaandonk. “There is a great need for mobile technology in Africa that is of top-notch quality but still affordable. What I found in Xiaomi is a company, and a business model, that can accommodate the needs of African consumers,” Van Spaandonk adds.
The London-based GSM Association’s The Mobile Economy, Sub-Saharan Africa 2014 report found that “Sub-Saharan Africa has been the fastest-growing region over the last five years, in terms of both unique subscribers and connections … By June 2014, there were 329 million unique subscribers, equivalent to a penetration rate of 38%… [and] 608 million connections.”
Mobile In Africa is setting up online stores in 14 countries, similar to the mostly-online sales strategy Xiaomi uses in China. “The brand is a mobile internet company. It has made its name selling directly to the public through online channels. We will try and replicate that as much as possible in Africa,” says Van Spaandonk. “What attracts me to the Xiaomi’s Mi brand is that they produce the highest quality product with the best available parts at the lowest possible price. For which there is an immense demand in Africa,” says Van Spaandonk.
Xiaomi is launching the Red Mi 2 (costing $160) and M4 ($320) in Africa next month.
Two Xiaomi handsets will be available at launch: the Red Mi 2 (costing $160 / ZAR1,999, including import duties in South Africa) and the Mi 4 ($320 / ZAR3,999). When we reviewed these handsets at Stuff magazine, we were impressed. “The Xiaomi Redmi 2 looks like a Lumia and feels like it’s comparable in quality. In performance, it fares slightly better than most of Microsoft’s MSFT -4.65% entry-level phones,” wrote Brett Venter, Stuff’s online editor who has been reviewing Android handsets for the last five years. “The Xiaomi Mi 4 is similar, except that it looks and feels like an iPhone 5 – with the hardware grunt and software versatility of Android behind it. The Mi 4, when it first launched internationally, was very nearly the perfect phone.”
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