After the US targeted Huawei and isolated it from US-origin hardware and software which led the company to its lowest position in terms of market share, Chinese companies decided to lower dependency on foreign technology. In attempts to do so, Xiaomi has been ramping up its investment into chips as the US pressure increases.
According to a recent report by a Chinese publication, the company has raised its stakes by a large amount in at least 34 China-based chip-related firms from 2019 till now. Moreover, it has also added stakes in about 25 other tech hardware-based firms that were not related to semiconductors.
Currently, Xiaomi’s main focus is targeting chip development, chip equipment makers, startups, and even advanced displays, camera lenses and automation and, precision equipment.
Xiaomi, like other Chinese tech companies, is working to build a more competitive tech manufacturing supply chain in the country. They are all working in collaboration to reduce reliance on foreign advanced technology and strengthening its own tech industry. Over the years, Xiaomi has become a rapidly growing firm in China, with its global smartphone market share rivaling other giants like Apple.
Huawei was also in a close battle with Apple and Samsung. However, the US trade restrictions turned the tables, affecting its market share. This led Huawei to focus on developing its own chips and locally produce everything, which is what Xiaomi might also be doing.
Xiaomi’s Founder, Lei Jun stated,
It has been seven years since Xiaomi invested in chips. … [The C1] is only a small step in Xiaomi’s chip progress, but it marks a milestone for our image processing capability. The road to [Xiaomi’s chip ambition] is long and full of challenges, but we have the patience and perseverance to make it.
We might see more Chinese companies becoming 100 percent self-sufficient in the near future.
