Google partners with Xiaomi Corp in India to capture 1 billion new users
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Google partners with Xiaomi Corp in India to capture 1 billion new users

American search giant Google is teaming up with Chinese smartphone maker Xiaomi to try and resurrect its Android One smartphone program for India. This revamp will hopefully put Google’s mobile software for users in emerging markets back on the map, after early partners failed to sell enough cheap devices, and interest waned. The goal is clear: to create a hardware and software platform that can compete with Apple – that means including the latest features – while coming in at a much lower price point.

Alphabet’s share price has appreciated by 21% in 2017, year to date

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SOURCE: Yahoo Finance

The partnership will take Google’s plan in another direction, as lower price points are now less o a focus. Xiaomi’s Mi A1 dual-camera device is a mid-range phone that will retail for 14,999 rupees (about $234), and will be better optimized for Google Assistant than previous phones have been. Xiaomi is now India’s number 2 smartphone brand, and Google will be hoping to leverage that popularity capture more users in the world’s fastest growing smartphone market.

The value in going more upmarket with the hardware is primarily avoiding competition at the low end. The Indian smartphone market is swamped with basic, unbranded, devices that leave big companies like Google little room to maneuver. However, at the mid-range price point, there is a real chance for Google’s operating system to get into more hands, and popularity to grow organically.

Android’s vice president, Jamie Rosenberg, said: “The selling point has really been this clean Android experience with the promise of updates. That’s independent from price point.”

Disclosure

Dominion holds Alphabet, the parent company of Google, in its Global Trends Managed Fund. 


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