Monday, January 7, 2019

XIAOMI Buys 0.5% Shares of TCL to Cement R&D PARTNERSHIP

It seemed like only yesterday when flat-screen television sets with LCD displays seemed like the wave of the future; then there was the novelty of curved flat-screens for a more cinematic viewing experience. Next in the ladder of development was the amalgamation of the online surfing and digital streaming to create “smart” TVs. Such a rapid advancement in the kind of stuff a television can do could easily leave many manufacturers of that ubiquitous appliance in the dust. It is therefore understandable that some of them form partnerships with computer makers in a bid to stay relevant in this present time when everything seems connected.
Tech Crunch reports that the third-largest maker of LCD flat-screen TVs in the world, TCL in China, has deepened its partnership with fellow Chinese manufacturer (of budget smartphone) Xiaomi. This was done by having Xiaomi, based in Beijing, buying 65.2 million shares of stock with TCL, amounting to nearly 0.5% as reported by the company to the Shenzhen Stock Exchange on Sunday, January 6. This action has led to the market value of TCL getting quite the boost of $36 billion, or close to 4 percent up, as of local trading on Monday, January 7.
This team-up between Xiaomi and TCL can be traced back to around December 29 close to the end of 2018, when the two companies inked an agreement on a collaborative partnership. Their terms include shared research and development in the integration of smart devices with a wide range of electronics. As a desired end result, it will enable TCL LCD TVs and other products to be incorporated into the third party-rich environment of Xiaomi’s operating systems. This is then reinforced by the two manufacturers sharing investments in developing new hardware.
A look at Xiaomi’s third-quarter results for 2018 shows that their hardware segment outside of their smartphone product line had their revenue growths primarily driven by smart TVs. To their founder and CEO Lei Jun, they will be able to further establish their brand for home appliances through working together with TCL, whose LCD televisions have come a long way from their 1981 origins as a maker of compact cassette tapes. To this, TCL CEO Li Dongsheng remarks, “Our partnership helps facilitate the transformation and upgrade of China’s manufacturing industry.”
The strategy of Xiaomi to partner up with manufacturers to make devices carrying their brand name has resulted in them having a strong selection of electronics and other devices that could do close to the performance of Apple devices, but at more affordable price ranges.
Image courtesy of CNet


Post a Comment