|Xiaomi announced that it would invest more than $7.2 billion over five years in an "All in AIoT" strategy in hopes to supplement and shift away from its declining core business of smartphones / Credits: Manuel Esteban via Shutterstock|
Chinese tech companies are proving that they can compete with Western counterparts as they invest in artificial intelligence. They have been using AI technologies to improve and secure their devices. Xiaomi, for instance, announced last year its five-year investment plan of $1.5 billion. The investment aims to expand in-house and third-party products compatible with the Xiaomi digital assistant, Xiao AI. At the same time, the smartphone manufacturer hopes that it can develop the capabilities of its AI.
According to Business Insider, a fast-growing business site with deep financial, media, tech, and other industry verticals, Xiaomi wanted its AI to serve as the intelligent focal point of the growing ecosystem of compatible devices. Thus, the tech company recently announced that it would invest more than $7.2 billion over five years in an "All in AIoT" strategy in hopes to supplement and shift away from its declining core business of smartphones.
A 2019 report showed that Xiaomi managed to offset the decline in its core smartphone segment with a 44% year-over-year (YoY) growth in the IoT and lifestyle products segment. This is after the company introduced several Xiao AI-enabled products such as TVs, refrigerators, washing machines, wearables, and even rice cookers. At the same time, Xiaomi aims to establish a lasting presence at the heart of the user experience by embedding its AI throughout the consumer technology ecosystem.
This has been proven effective since Google and Apple's success in the smartphone era as well as Microsoft's dominance in the PC era have helped them maintain a significant competitive advantage in their control operating systems. This also explains why tech giants are fighting to place their digital assistants at the center of connected device ecosystems. According to experts, Xiaomi needs to leverage its core smartphone business to gain voice assistant market share. The company’s smartphones could end up being key to the future success of its digital assistant strategy through its billion-dollar investment.