The way of the Chinese tech company: ‘openly fight Apple, secretly battle Xiaomi’

Late last week, executives from Xiaomi and LeTV butted heads on Weibo over LeTV’s claim that it has the first “borderless” smartphone. It started with Xiaomi CEO Lei Jun mocking the borderless claim since LeTV’s phone does have thin black screen borders. After a rebuttal from a LeTV executive, LeTV CEO and founder Jia Yueting chimed in with this apparent message of peace:

I hope Chinese companies can work hard together to overtake the iPhone hand-in-hand, push forward progress in the industry, and create greater value for consumers.
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This message of unity is a frequent refrain in China’s domestic smartphone industry. It’s also a complete sham.

In actuality, most outside observers would agree that LeTV’s true intent is to compete with Xiaomi. Its smartphone pricing is far closer to Xiaomi’s than Apple’s, and in fact LeTV is even making a similar claim to one Xiaomi once made: ‘our goal isn’t to profit from hardware sales.’ LeTV’s true strategic approach is often summed up in the Chinese press with the expression: “openly fight Apple, secretly fight Xiaomi.”

This isn’t a LeTV innovation, it’s actually a tried-and-true approach that’s pretty common in China’s tech industry. The general format is that a company openly fights a foreign competitor in its market, loudly attacking it the way LeTV has attacked Apple. But less publicly, the company’s actual goal is to defeat domestic competitors.

This PR approach – ‘openly fight major foreign brand, secretly battle domestic competitor‘ – allows Chinese tech companies to get some press attention by connecting themselves with a global brand like Apple, and score some PR points for being a home-grown company with the guts to stand up to foreign juggernauts. But because their attacks on these global brands are so ambitious, nobody takes them all that seriously. Companies that make these claims don’t really have to stick to them, so it’s a win-win: you get your press coverage from taking potshots at Apple, but the domestic press still won’t deem your product a failure when Apple outsells you.


This photo of Xiaomi founder Lei Jun, released prior to the Xiaomi M1 launch, shows him standing in front of lots of photos of Steve Jobs.


The battle against domestic competitors, in contrast, is generally played out in the background. It’s never a total secret, and sometimes it’s pretty obvious (particularly if you follow the founders’ Weibo accounts), but it’s also never a major feature of the company’s PR drive. For example, at the LeTV smartphone launch event, the clear focus was on attacking Apple, despite the fact that Xiaomi is a much more important competitor for the same market (tech-savvy white-collar twenty-somethings) at LeTV’s price points.

A few years ago, we saw a similar battle play out between Xiaomi and Meizu. Although the bad blood between the two companies – particularly their founders – was no secret, Xiaomi’s PR focus prior to the launch of its first phone was on drawing comparisons to Apple. The first Xiaomi phone was launched publicly for the first time at around the same time as Apple’s iPhone 4S in China (the 4S hit China on December 16, the Xiaomi went on sale publicly on Dec 18). It was often branded in the media as “China’s iPhone-killer,” despite the fact that at the time, Meizu was a more significant competitor for Xiaomi’s potential market than Apple, whose phones cost three times as much.

Of course, the ‘publicly fight foreign company, privately battle domestic company‘ approach does lead to some confusion, especially in the Western press where challenges to global juggernauts are often taken at face value and dismissed out of hand. Prior to Xiaomi’s launch many observers thought the company’s apparent Apple fixation was nothing more than a ridiculous pipe dream, and wrote the company off as a failure waiting to happen. And while Xiaomi didn’t beat – or even compete with – Apple right out of the gate, it did snatch up a big chunk of the low-end smartphone market from domestic competitors. After years of building from there, it actually has been able to beat out Apple domestically, but that was not the immediate goal back in 2011, despite the PR push suggesting the contrary.

Destroying Apple isn’t really LeTV’s immediate goal either. The next time you hear a Chinese company take this kind of aggressive stance against a foreign brand prior to a big product launch, remember: this is just a PR strategy. The great Chinese strategist Sunzi once wrote that all warfare is based on deception, and if a Chinese tech company is attacking a seemingly unassailable foreign brand in public, there’s a good chance that they’re quietly far more interested in beating out a domestic competitor.

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