Long, winding queues of gadget fans all lining up to throw their money at the latest flashy iProduct, a treatment usually reserved for Apple. But here in China, a homegrown brand is inspiring its own platoon of highly motivated buyers.
More than 300 people lined up around the block in Hong Kong on January 1 to get their hands on Meizu’s latest phone. And that was mirrored in cities across China.
It’s all for this: the Meizu MX.
You might be forgiven for mistaking it for an iPhone. It’s not hard to see where the company found its inspiration.
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Some Chinese consumers love it. Among those lined up today, aviation management student Kenny Tang.
“It looks like the iPhone, but inside the software, the UI, the design is completely different.”
“Three days on from its launch, people are still lining up here in Hong Kong for this – the Meizu MX. It looks like an iPhone, but it only costs $400.”
Loaded with the latest hardware, it’s a lot cheaper than the iPhone4S at $650 or the Samsung Galaxy Nexus at $700.
And that’s helping these so-called “shanzhai” firms – the Chinese term for manufacturers known originally for knock-offs. Now they’re moving up the value chain to sell their own branded products.
“As everyone knows, the average salary in China isn’t that high right now. So this is definitely more affordable than some of the other more mainstream phones in the market right now. But at the same time we don’t sacrifice on specifications.”
The problem, though, is scale. Big players like Apple and Samsung pay far less for the components inside their phones than smaller handset makers. And that means tighter profit margins for the shanzhai players, says Analyst Mark Newman.
“I don’t think these Chinese brands really are going to compete head-to-head in the mainstream market but more in the mid to low end, especially in China – in the domestic market. But they don’t have a lot of scale and so it’s going to be difficult for them to compete with Samsung.”
There is hope though. Huawei was once a small player. It now commands 11% of the mainland market.
With more than 950 million mobile phone users in mainland China, shanzhai firms like Meizu have plenty of room to grow. Especially as more consumers look for smartphones… on budget prices.