Xiaomi's Plan To Storm US Phone Market By Early 2019 Could Face Government Backlash

Over the past few years, Xiaomi has risen to become one of the top smartphone manufacturers on the planet. According to IDC, Xiaomi doubled its Q4 2017 sales compared to the prior year, and currently sits in fourth place in global smartphone shipments with 7 percent of the market. However, if all goes according to plan, Xiaomi could further expand its reach with a big push in the United States.

Xiaomi Chairman Lei Jun said in a recent interview, “We’ve always been considering entering the US. market. “We plan to start entering the market by end 2018, or by early 2019.”

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The Chinese company has a number of products that it currently sells in the U.S., but it's relegated to streaming boxes, fitness bands, and headphones. The U.S. smartphone market, however, has remained elusive to Xiaomi.

Despite Jun's optimism about entering the market by as soon as this year, there are plenty of potential roadblocks. For starters, Xiaomi isn't exactly a household name in the U.S. -- especially in a market that is dominated by names like Apple and Samsung, and to a lesser extent Motorola and LG. In addition, Xiaomi is bound to face questions surrounding Chinese meddling and security from U.S. government officials.

To that last point, Huawei's plans to enter the U.S. phone market backed by carriers like AT&T and Verizon were torpedoed by the government, which feared that the company would install backdoors on its smartphones fueling spying fears. Having access to wireless carriers to sell smartphones is critical in the U.S. market, which Huawei CEO Richard Yu acknowledged earlier this year at CES.

“Everybody knows that in the US market that over 90 percent of smartphones are sold by carrier channels,” said Yu. “It’s a big loss for us, and also for carriers, but the bigger loss is for consumers, because consumers don’t have the best choice.”

There's no question that Xiaomi will face similar pressure, so it remains to be seen just how successful the company's U.S. venture will be -- especially if can't get backing from major wireless carriers.


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