It’s now official that Xiaomi isn’t bringing the newly announced Mi Note 2 and Mi Mix to India. The smartphones were launched amidst lots of fanfare in China yesterday, and the expectations of India launch gained momentum as Xiaomi took quite a few Indian journalists and bloggers to the launch event in Beijing.

mi-mix

Unfortunately, the Indian fans would have to deal with the disappointment of yet another cool product from Xiaomi which won’t see the light in India.

But then, Xiaomi’s strategy has been quite clear. The company never launched the Mi Note or the Mi Note Pro in India, although they did launch the Mi 3, Mi 4 and the Mi 5. While the Mi 3 and Mi 4 were launched at the fag end of their sale cycle, the Mi 5 was launched just weeks after the global launch. That probably peaked the expectations of Indian fans that Xiaomi is ready to launch other high-profile devices like the Mi 5s and Mi Note 2 in India.

But the truth is, the premium smartphone market in India is extremely thin.

Xiaomi_Mi_Note_2

As per Gartner, the Average Selling Price (ASP) of smartphones in India is $70 and smartphones under $120 contribute around 50% of overall smartphone sales here. Now consider the pricing of the new smartphones launched in China. The Mi Note 2 starts selling at $413 and goes all the way to $516 for the high-end variant. The Mi Mix starts at $516 and goes till $590 for the high-end variant. Lastly, the Mi 5s is priced at $295 for the base variant and goes all the way to $385 for the high-end Mi 5s Plus.

Someone like Xiaomi who operates on crazy thin margins would need real high volumes in sales to justify launching new products in new markets. Of course, the Indian economy is improving and smartphone market is booming, but the truth is, it’s still nowhere close to China. The biggest success for Xiaomi in India has been the Redmi Note 3 which retails for Rs 11,999 or $180. Compare that with the sales of Mi 5 in India. Although Xiaomi hasn’t disclosed how many units of Mi 5 it has managed to sell in the country, it’s an open secret within the industry that the sales are pretty dismal not just in comparison with Redmi Note 3, but the Mi 4 as well. Of course, the price isn’t the only factor playing with the fate of Mi 5, but it’s clear that Xiaomi has very little breathing space in the $300+ segment in India, with its nemesis, OnePlus 3 and others like the Lenovo Z2 Plus breathing down its neck. They still can’t completely ignore the higher mid-range market in India for branding and other reasons, so expect them to release at least one premium smartphone a year.

Someone like OnePlus is beautifully and successfully transitioning from a value player to a premium value player, and that’s where I think Xiaomi has failed, at least here in India. Considering that they’re facing the heat in their home country too, the company probably can’t afford to go bullish on newer terrains like India by launching too many products.

For Xiaomi to make any significant impact, they need to price the new smartphones even more competitively than they do in China, which simply doesn’t make business sense for the company. We have reached out to Xiaomi India for a comment and will update this post if and when we hear back from them.


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Raju is the founder-editor of Technology Personalized. A proud geek and an Internet freak, who is also a social networking enthusiast. You can follow him on Facebook and on Twitter. Mail Raju PP. Follow rajupp