Brotherhood of Bandits, Lei Jun and Xiaomi Hook Up with Other IP Thief?

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December 19, 2014 by ...

A Chinese woman runs one of China’s biggest appliance makers-Gree was upset to see Xiaomi hookup with a other Chinese appliance maker-Midea. And here is what she had to say, ‘Two swindlers working together makes into a fraud group.’

She was referencing the fact that both Xiaomi and. Midea had IP problems. According to her, they are both thieves. She proclaimed as much as soon as she heard that Jun had tossed cash Midea’s way.

Although she only knows Xiaomi by its rep, she has in depth knowledge of its newest buddy Midea. And according to her, that Chinese firm has been stealing her tech for years now. According to her, ‘Xiaomi is just like Midea, they steal ideas too. They are swindlers,’ she said.

Is there any truth to this?

Hmmm, lets take a look at Xiaomi side-by-side to Apple…

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Based on the evidence it would appear that the owner of Gree has a point. Setting aside Lei’s constant less than endearing smirk and sketchy demeanor,

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His track record is less than stellar. Within six months of his international debut, Xiaomi at leat three countries have called for a ban on their gear, it was proven that they covertly swipe data, their power bricks explode, and they have been nailed for IP theft. Aside from this, their new air purifier seems to be a mock up of the same Japanese model that has been sold in China for years.

I don’t know if he is a ‘swindler’ but Jun’s character may need some polishing.

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In fact, Lei Jun just seems dodgy. He sprints around to press conferences showing up late, issuing cryptic messages, all the while surrounded by his ‘man harem’ , a la Osama Bin Laden.

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I am not trying to torpedo his character, but something just seems odd about the guy. He commands the diaosi or angry Chinese youths who sit transfixed as he promises them world domination and the rise of the motherland

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After his ‘Orange day’ meetings, his droogs file out to enhance their cred by squandering a few more shekels and enhancing Jun’s overall wealth.

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His overall strategy seems to be ‘throw cash to communist party buddies and see what works. Just the other day he said that he wanted to start 100 companies that would sit atop their respective industries. Absent a serious return to Mao’ist doctrines of seriously protected Chinese firms, I don’t see it happening. Most companies do one or two things well and the good ones a couple dozen. But Lei Jun wants 100 blockbusters. This would be quite a feat for anyone, let alone a Chinese firm with an already sketchy record, no potential to innovate and a self-limiting business model.

I admire Jun’s guts, he has got brass. What he fails to realize that IP theft is not scalable. Sure he can dominate the lower echelons of China, but will he go beyond that? I am not so sure. I am equally unsure of what if anything drives his business model. Thus far drives his firm seems to be a knock off Iphone clone supplier which calls itself an internet play even though 92% of its rev comes from handsets. If you can figure any of this out, please clue me in.

Oh yeah, one more thing. Xiaomi has less than 12 invention patents to its name thus far. The owner of Gree referenced this when she said that if the two of them can write more patents than she then she would be surprised. But if it did happen, she claimed she’d knuckle down and fight back with honest competiton.

That comment is an obvious dig at Xiaomi’s blatant copying. I think she fears the obvious, lei coming in with ‘locust pricing’ which shreds the profit pollen leaving everyone at near ‘great leap forward’ levels of hunger. Jun then subsidizes the hell out of his kit through allegedly nefarious ways and forces the competition to withdraw. In a battle based on price, almost everyone gets bloody.

Gree’s owner seems like a tough old bird who is willing to dight. It will be interesting just how far the battle will go.

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