Stronger by Paying Salaries and I Have 1 Billion Employees

”It’s fine. Compared to the Orange C3, the Xiaomi 2S and 2A aren’t priced that high. Their features are a bit lacking, that’s all. It’s not like they’re unusable,” Lei Yijun said, unconcerned.

Just then, the phone on his desk suddenly rang. He leaned forward, and after seeing the caller ID, he immediately pressed the answer button.

”President Lei, is the R&D for Little Love wrapping up?” Chen Yansen skipped the pleasantries and asked directly.

”Almost. I plan to launch it at the spring new product conference.”

Lei Yijun didn’t try to hide it. After all, Little Love’s creation was entirely dependent on the Yuxi development platform.

”Does Xiaomi have any plans for a smart speaker?” Chen Yansen continued to ask.

Hearing this, Lei Yijun froze for a moment, not knowing how to answer.

In reality, the industrial and hardware design teams for the Little Love smart speaker were already being assembled. But the technology had come from Chen Yansen, so he was too embarrassed to tell him that Xiaomi wanted to compete with Orange Technology for the smart speaker market.

So, without batting an eye, Lei Yijun brazenly denied it. ”No.”

”That’s a shame. Orange Technology is developing a dedicated AI chip that can reduce hardware costs by 20%. I was hoping to ask if President Lei was interested in a partnership.”

Chen Yansen said nonchalantly, leaning back on the sofa.

As for what Lei Yijun said, he didn’t believe a single word of it—not even the punctuation.

”An AI chip? President Chen, you’ve assembled a chip design department?” Lei Yijun’s eyes widened as he asked in disbelief.

One had to understand that in the 2012 mobile phone industry, only a communications giant like Huawei had chip R&D capabilities.

Although neither the Hisilicon K3V1 from three years ago nor this year’s Hisilicon K3V2 had achieved significant market success, they had at least pioneered in-house chip development for domestic mobile phones.

How long had Orange Technology even been in the business?

A year and a half, at most!

”The procurement cost for the TI OMAP 3630 is too high, and a general-purpose chip wastes too much performance. Plus, it can’t unleash the full potential of the Moss Intelligence interactive engine. By creating a dedicated chip that integrates the CPU, NPU, DSP, Wi-Fi and Bluetooth communication, and audio codecs, we can both save costs and boost performance. Since President Lei isn’t making a smart speaker product, you probably don’t understand the difference.”

Chen Yansen said, teasing him with a smile.

’I know all too damn well!’

Lei Yijun almost blurted it out, but he managed to stop himself in time.

He had actually done his research on smart speaker products. The material cost alone was no less than 350 Hua Yuan. After factoring in manufacturing, shipping, sales, and operating costs, there was very little profit margin if priced under 600 Hua Yuan.

In other words, Orange Technology’s dedicated AI chip could cut costs by around 70 Hua Yuan. Lei Yijun was naturally tempted.

”President Chen, I’ve just given it some thought, and I believe Xiaomi could also make a smart speaker. You wouldn’t mind, would you?” Lei Yijun couldn’t keep up the act any longer and asked tentatively.

”Of course not,” Chen Yansen replied immediately.

’Selling one Celestial Craft T100 Chip to Xiaomi for 40 US Dollars isn’t excessive, right?’

’Besides, Xiaomi doesn’t have its own factories. The Orange Phone Factory can earn a manufacturing fee on top of that.’

’A double win. No matter how I look at it, I can’t lose!’

Besides, did he really think Lei Yijun wouldn’t build a speaker if he didn’t provide Xiaomi with the Yuxi development platform and the AI chip?

It was better to have another friend than another rival.

The Alexa smart speaker was exploding in popularity in Europe and America. Did he think Qualcomm, Intel, Broadcom, and NVIDIA couldn’t see that?

Orange Technology’s real competitors were in Europe and America, not within the country.

”Thank you for your support of Xiaomi, President Chen. I must pay you a proper visit another day.” Lei Yijun felt a warmth in his chest, suddenly feeling that Chen Yansen’s character was far better than Zhou Hongyi’s.

”Alright. Let’s leave it at that for now. Once the Celestial Craft T100 Chip’s design and production are complete, we can discuss the details of our partnership.”

Chen Yansen took the initiative to end the conversation.

”No problem. We’ll talk again soon.” A look of delight on his face, Lei Yijun hung up the phone with a smile.

The negative impact from the sanctions on the Xiaomi Box was instantly swept away.

”Ah Li, speed up the preparations for the Little Love speaker. It would be best to launch it at the same time as the spring conference.”

Lei Yijun instructed Li Wanqiang.

”Boss, would Chen Yansen really be this kind?” Li Wanqiang felt that something was off.

”He just wants to sell chips and earn manufacturing fees. As long as the price is reasonable, there’s no harm in Xiaomi partnering with Orange Technology.”

Lei Yijun said with a wave of his hand.

’We can’t just keep lining the pockets of outsiders, can we?’

Now, by leveraging Orange Technology’s supply chain, Xiaomi had switched its screen supplier to Jingdongfang, which was another way of supporting domestic products.

Previously, Zhou Hongyi had harped on Weibo about Xiaomi Mobile Phone’s procurement of Sharp screens, scolding him for earning money from his countrymen but refusing to use domestic suppliers.

This way, Sect Leader Zhou would lose his reason to attack Xiaomi.

「Elsewhere.」

Chen Yansen had just put down his phone when a ”KNOCK KNOCK KNOCK” came from the door.

”Come in!” Chen Yansen said.

Huang Zheng hurried in, grinning. ”Ma Liyun has lost his mind!”

Chen Yansen leaned back, waiting for an explanation.

He highly doubted that Lao Ma had suffered a sudden illness and been sent to a psychiatric hospital.

”This is the latest announcement from Ali’s Mother. The bosses of Mogujie, Meili Shuo, and What’s Worth Buying are furious.”

With that, Huang Zheng handed over a document. On it were the new rules released by the Taobao Alliance at noon.

Starting January 1, 2013, the Alliance would cancel the Taobao Guest model of cash-back rebates for purchases on Taobao Station (including Tmall Mall). It would only permit non-cash rebates such as points, physical goods, and coupons.

In other words, giving users direct cash rebates had become a violation. Ali’s Mother had the right to deduct points and freeze the platform’s rebate account.

Perhaps not wanting to affect the 2012 Singles’ Day sale, Ma Liyun had set the effective date for New Year’s Day 2013.

This move by Lao Ma officially declared the end of the honeymoon period between Ah Li and the shopping guide e-commerce platforms.

Chen Yansen glanced at it, not at all surprised.

He knew that Ma Liyun and Liu Qiangdong had the same attitude toward shopping guide e-commerce: they looked down on it and despised it, yet they couldn’t bear to part with the traffic and orders from third-party external channels.

Essentially, Taobao, Pinbei, and Jingdong were all just middlemen for internet traffic.

They bought traffic at a low cost, packaged it as a marketing tool, and sold it to their resident merchants.

”This is just the beginning. The shopping guide platforms will suffer for a while at most. If Lao Ma removes their sales weighting, that’s what will truly be the death of Mogujie, Meili Shuo, and What’s Worth Buying.”

Chen Yansen put down the document and said with a light chuckle.

”He wouldn’t, would he?” Huang Zheng was skeptical.

”Strengthen your cooperation with the shopping guide platforms. Pinbei Alliance must devour all the market share that Ah Li is abandoning.”

Chen Yansen looked at Huang Zheng and instructed him.

The relationship between shopping guide e-commerce and comprehensive e-commerce was subtle, involving both cooperation and competition.

And Ma Liyun’s reasons for suppressing the shopping guide websites were also very simple.

First, a shift in traffic strategy. The Taobao Guest promotion model from the PC era didn’t align with Ah Li’s wireless traffic strategy. Ma Liyun wanted to focus his business on the mobile end.

Second, to protect the interests of Tmall Mall and Taobao. While Mogujie, Meili Shuo, and What’s Worth Buying brought traffic to Ah Li, they also siphoned off a portion of the merchants’ advertising fees. This reduced investment in advertising products like pay-per-click services, display ads, and Juhuasuan.

Making money for Lao Ma was fine, but trying to snatch money from his hands?

No way!

Third, to build a closed industrial loop. He would replace the cash-back model with Wealth Treasure’s points product, Jifenbao, thereby tying user consumption to Ah Li’s e-commerce ecosystem and forming a closed transaction loop.

Fourth, to support his own shopping guide product. Lao Ma had spent tens of billions on FoxTao. Why wouldn’t he keep the benefits for his own ”son” instead of raising outside ”godsons”?

After confirming Chen Yansen’s stance, Huang Zheng continued to use the cash-back rebate model, causing Pinbei’s external traffic to increase rapidly.

From November 1st to November 3rd, the Taobao-affiliated shopping guide business plummeted while Pinbei’s guide business output soared. During the pre-sale stage of the Singles’ Day promotion, it managed to maintain a daily sales volume of 1.2 to 1.4 billion Hua Yuan, significantly ahead of Jingdong.