China’s biggest smartphone vendor has sought to put worries about its flagging growth aside with a high-spec and remarkably low-cost smartphone, its new flagship Mi5.
Launched an hour apart in Beijing and at MWC in Barcelona on Wednesday, the new phone starts at 1,999 yuan, or approximately $300.
That’s less than half the price of the cheapest, 16 GB iPhone 6S which retails at $649, or Samsung’s latest Galaxy S7, which starts at $670.
It’s a bold bet for a Xiaomi, which hasn’t put a flagship device out on the market for 18 months and has been pulling in funding rounds at a most recent valuation of $45 billion.
Despite the low cost, the Mi5 boasts some impressive specs: a durable ceramic case (on the Pro version) rather than the usual glass or metal, a new 16-megapixel Sony camera sensor that claims more realistic colours, and Qualcomm’s latest Snapdragon 820 processor.
The new chip from Qualcomm was launched to the market in January, and it’s possible that the Mi5 will be the very first smartphone to get it to consumers.
The Mi5 is also light, weighing just 129 grams, compared to the 143 grams of the iPhone 6S, and runs on a skinned version of Android called MIUI; the latest MIUI 7 is built on Android 6.0 Marshmallow.
The Mi5 goes on sale in China from March 1, followed by a launch in India and “other markets” afterwards, according to Xiaomi’s head of international growth, Hugo Barra, who led the company’s launch event at MWC in Barcelona.
This marked Xiaomi’s first official appearance at MWC, and at a time when the company needs to kickstart growth overseas in order to make up for a flagging performance in China.
Xiaomi’s co-found and CEO Lei Jun had set the company a goal last year of selling between 80 and 100 million smartphones for 2015, but the company closed out the year having fallen short at 70 million.
Part of the problem is Apple’s remarkable success at capturing the high end of the increasingly saturated Chinese market. Even though its phones are twice the price, consumers there are eager to pick up iPhones as a status symbol.
Average selling prices for smartphones in China have also been rising over the last three years, according to figures from research firm Canalys, from $255 in 2013, to $260 in 2014 and $319 in 2015, somewhat undermining Xiaomi’s value-for-money pitch to consumers.
Xiaomi has yet to sell any of its phones in the U.S. or Europe, though Barra has been quoted as saying the the U.S. is "on the radar" for Xiaomi.
A more likely prospect for its next international launch is Brazil. Barra, who is Brazilian himself, led a successful launch of the Xiaomi's mid-range, $190 RedMi phone in July 2015.
