After overtaking Samsung to become the biggest smartphone brand in India, Xioami is now looking to challenge players like Netflix, Amazon Prime, Spotify, Paytm and others with a plan to monetise internet services in the country, reports The Economic Times.
The Chinese company wants to start gaining revenue flows from streaming of online content like videos and music, while also offering other e-services such as digital payments. Xioami India managing director Manu Kumar Jain stated that this expansion bid into services will be financed by utilising at least part of the recent Rs 3,500 crore infusion of capital into the company.
“Xiaomi globally made less than 1 per cent profit margin from hardware or device sales in 2018, and we have stated that will never make more than 5 per cent profit margin on hardware,” he remarked.
He added that it will be internet services which will make the company money.
Xioami wants to begin monetising its existing services such as Mi Video, Mi Music and Mi Drop. It has also just rolled out its Unified Payments Interface (UPI) -based digital payments system and is also looking to commercialise its instant loan offering Mi Credit, which is presently at a pilot stage.
Jain said that the company may look to apply for a Non-Banking Financial Company (NBFC) license. The license would allow the company to start offering financial services to consumers directly.
The company’s music-streaming service, Mi Music, already has 40 million monthly users in India but is currently free. As part of its monetisation push, the company has recently begun offering a paid subscription music plan as well.
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