Xiaomi Continues Self Defense After Apple Slam

Includes: AAPL
by: Doug Young

Bottom line: Hugo Barra's remarks in defense of criticism that his employer Xiaomi copies Apple's (NASDAQ:AAPL) designs could mark the start of a longer-term war of words that could end in one or more lawsuits by Apple.

A trans-Pacific war of words that began with critical remarks made by Apple's chief designer 2 weeks ago is continuing, with the foreign face of Chinese smartphone sensation Xiaomi giving fresh remarks on the copycat controversy in his company's defense. The comments from Xiaomi's international marketing head, Hugo Barra, are a bit lame, in my view, and I really doubt he would have made such remarks last year, when he was still a rising star at global Internet giant Google (NASDAQ:GOOG).

But much has happened in the last year, including Barra's own defection to Xiaomi last summer. He jumped ship to join a fast-rising Chinese company that some were comparing to a young Apple, as its mid- to low-end smartphones rapidly rose to become a favorite among young and trendy Chinese. Figures released earlier this week showed that rise continues, as Xiaomi became the world's third-largest smartphone maker in the third quarter, behind only Apple and the equally established Samsung (OTC:SSNGY) (Chinese article).

Xiaomi's explosive growth this year is being driven at least partly by Barra, who has been tasked with taking the company global with moves into Taiwan, Hong Kong, Southeast Asia, and most recently, India. That company's rapid rise was almost certainly a factor behind the icy remarks made at a mid-October event by Jonathan Ive, Apple's lead designer, and one of the main forces behind its smartphones and computers that are widely praised for their stylish looks and ease of use.

Responding to a reporter's question asking for his views about Xiaomi 2 weeks ago, Ive said that he didn't see the actions of companies like Xiaomi as flattering (previous post), He went on to add that such companies were thieves because they stole from innovators like Apple, which poured years of work and huge sums of money into new product development. Xiaomi didn't have much to say after those remarks, though the company's usually talkative CEO, Lei Jun remarked on his microblog that Xiaomi was still in its formative stages, in an implied defense of its copycat ways.

Barra made some brief remarks when the controversy first occurred, and now 2 weeks later, has spoken up in more detail on the sidelines of a forum near Los Angeles, where a number of big-name tech executives were also attending, including Apple CEO Tim Cook. In his latest remarks, Barra says that Xiaomi's designers received their inspiration from other developers of superior products, though it doesn't appear he mentions Apple specifically (Chinese article). He goes on to note that Xiaomi isn't alone in this kind of practice, and that industry leaders like Apple naturally attract followers and imitators in a wide range of other product areas.

Barra gives a few more remarks after that, including a challenge to anyone to find a product with unique design in the highly competitive smartphone space. That is indeed true, partly because a big majority of models now use Google's free Android operating system (OS), which Barra and his team helped to develop and popularize. Perhaps Barra's argument does hold some truth, since many of the models now on the market from the likes of Huawei, ZTE (HKEx: 763; Shenzhen: 00063) and Lenovo (OTCPK:LNVGY) do all have a similar look and feel.

But the reality is that Xiaomi probably at least partly deserves this kind of put-down, since the company loves to brag about its innovation and how cool its products are, and takes every opportunity to compare itself to Apple. Xiaomi's rapid rise has certainly caught Apple's attention, and Ive's remarks and now Barra's defense could well mark the start of a longer-term war between these 2 companies. Accordingly, I could easily see a lawsuit coming from the litigation-happy Apple in a western courtroom in the next year or two, if Xiaomi continues its meteoric rise that includes a heavy dose of "inspired" imitation.

Disclosure: None.