Lei Jun’s new ambition, Xiaomi’s new battlefield: paying

Millet throws heavy money to buy a payment license, indicating that Xiaomi has already thought about making finance a sector, not just a tool.

On September 1, Mi Pay officially debuted. Like Apple Pay and Samsung Pay, Xiaomi Payments uses NFC (Near Field Communication) technology to complete transactions by placing the phone close to a POS terminal that supports the "UnionPay Cloud Pay" feature. There are 21 Mi Pay cooperative banks, supporting bus cards in Shanghai, Shenzhen, Beijing, Guangdong, Suzhou and Wuhan.

"For the ecology of the entire software Internet, payment is an indispensable part. Only after payment is made, the whole ecology can become a closed loop." Xiaomi Payment General Manager Qian Bird (original name: Song Zhenzhong) said in an interview with reporters. .

With the launch of Mi Pay, Xiaomi's software and Internet service ecosystems have become more complete, and their ecological strength has gradually taken shape. The battle between Xiaomi and Huawei has not reached the end, and the return of Xiaomi to its ecological advantage means that a new round of war has begun.

"Xiaomi used to put too much bet on the phone." A person who has worked closely with Xiaomi told reporters. Although Xiaomi's core foundation is still a mobile phone, at this stage, Xiaomi faces great pressure on mobile phones both inside and outside. Xiaomi's adjustment strategy develops ecology, which can at least make Xiaomi's foundation stable.

Dual identity

Just like the mall is the support of Jingdong, Taobao is the support of Ali, WeChat is the support of Tencent, Xiaomi's e-commerce is also the most important support for Xiaomi to enter the payment field.

Mobile phone manufacturers to seize the payment scenario is only the appearance, the root of this battle is that mobile phone manufacturers become a conduit. They either work for Alipay, WeChat, or work for UnionPay, and it is difficult to play a leading role in the field of third-party payments.

Market research institute Gartner analyst Shen Zheyi told reporters that for mobile phone manufacturers, NFC technology is like a camera or Bluetooth, and will become the standard for mobile phones in the future, but it is unlikely to become a new profit model or business trend for mobile phone manufacturers.

The key to understanding Xiaomi's payment is that Xiaomi is not a pure mobile phone manufacturer. The third e-commerce identity in the country makes Xiaomi more ambitious than other mobile phone manufacturers including Huawei in the layout payment business and financial business.

The field of payment for millet layout was as early as four years ago. In mid-2012, the “Millet Payments” department was established, and initially began to incubate third-party payment services with “Miancoin”. The department is affiliated with MIUI, which provides software and Internet services. The department also includes the “Millet Finance” business unit that provides services such as wealth management, insurance, and loans.

In December 2013, “Millet Payment” was independently Beijing Xiaomi Payment Technology Co., Ltd. According to the business registration information, the legal person is Lei Jun. “Millet Payment” is an independent registered company of the business department of MIUI, which shows that it is valued. The earliest NFC mobile phones with NFC can be traced back to their millet 2A and Xiaomi 3 released in 2013, but Xiaomi 2A has not yet shipped a security chip.

The layout was early and valued. However, the Xiaomi payment business has not been done. Thousands of birds told reporters that the NFC payment market was very chaotic. The industry chain was long and the participants were many. The interests of banks, UnionPay, mobile operators, mobile phone manufacturers and technology (patent) providers were difficult to balance, which led to slow development.

A typical example of this is the twists and turns that Apple Pay experienced when it entered China. According to an industry source, Apple Pay will charge 0.15% of service fees to banks and card organizations in the United States, but Chinese banks do not agree to similar commercial terms, and negotiations have been glued. In the end, the two sides compromised, and Apple promised not to charge in China within three years, and all other mobile phone manufacturers continued this rule when they started the business. A number of industry insiders interviewed by reporters said that Huawei Pay and Mi Pay are not currently receiving fees such as fees in financial transactions.

During the slow development of near-field payment, Internet payment companies used the QR code to preemptively distribute offline mobile payments and bypassed UnionPay in the payment process. According to Analysys International data, in the first quarter of 2016, UnionPay's mobile payment market share was only 0.69%, and Alipay and Tencent's Tenpay accounted for 86.44%. In the face of fierce competition, UnionPay accelerated the coordination of related interests and launched “UnionPay Cloud Flash Payment” in December 2015, which supports both iOS and Android operating systems. This year, various mobile phone manufacturers have successively launched NFC mobile payment services, all of which are in cooperation with “UnionPay Cloud Flash Payment”.

"We have a hard time doing NFC payment." A Xiaomi marketing department told reporters that the market for NFC payment in China is actually brought by Apple Pay, in the case of different stakeholders and market confusion. , unified the use of access to UnionPay to provide services. "Apple's appeal is unprecedented," said the Thousand Birds.

At present, Apple Pay, Samsung Pay and Huawei Pay on the market are all based on NFC technology, "near-field payment" through "brushing" mobile phones. Alipay and WeChat payment belong to “remote payment”, which requires the Internet to connect with a remote server to complete. Near-field payment and remote payment are the two camps in mobile payments.

There is controversy in the industry about the prospect of near-field payments. An ant Jinfu company told reporters that Alipay and WeChat use the scanning code to lower the threshold, relative to NFC payment requires pos machine, scan code payment only needs a QR code. At the same time, Alipay has been deeply involved in the industry for many years and can be closer to business applications.

Shen Zheyi analyzed the reporters, the use of NFC payment is limited, people must appear on the scene, and remote payment can not only meet the scenes of people who are not on the scene, such as online shopping, transfer, etc., but also can meet the demand of close payment by scanning code, so The coverage of the usage scene is wider. She compared that even Apple Pay is not a success in the US mobile payment market.

Based on the dual identity of mobile phone manufacturers and e-commerce, near-field payment is not the whole payment of Xiaomi, and its payment business also includes another section - "fast payment", which is the same as Alipay and WeChat payment, and is remote payment.

Thousands of birds said that Xiaomi is currently the only payment company that is both near-field and remote. For Alipay and WeChat, Xiaomi has hardware that they don't have, and can do near-field payment. For mobile phone manufacturers, Xiaomi has its own unique Internet ecology, which can be used for remote payment. Xiaomi also laid out both at the same time, in order to find opportunities to overtake the corner.

"Millet is going to make payment, not because it is a mobile phone manufacturer to pay." Hong Bo told reporters that Xiaomi's biggest advantage lies in the natural user group carried by its e-commerce business. Just like the mall is the support of Jingdong, Taobao is the support of Ali, WeChat is the support of Tencent, Xiaomi's e-commerce is also the most important support for Xiaomi to enter the payment field.

Financial exploration

Xiaomi has already thought about making finance a sector, not just a tool.

For any company's financial business, payments are “hydroelectric coal” infrastructure.

Guotai Junan analysis said that in 2003, when Alipay was launched, it was no more convenient than other payment methods. However, because it controlled the trading behavior of customers, it directly embedded the payment link into the transaction and quickly completed the construction of the ecology.

In the outbreak of Alipay in 2014, it was precisely because users frequently used the payment function in daily transactions, which generated a large amount of deposit funds, which in turn led to financial needs, so naturally, other financial businesses such as Yu'ebao were born and paid in ant gold. The service system plays the most important role.

In January 2016, Xiaomi acquired Jiefu Ruitong Co., Ltd. (hereinafter referred to as “Jiefu Ruitong”) for RMB 600 million. The company obtained the “Payment Business License” issued by the central bank in 2011. After the acquisition, Xiaomi held 65% of the shares and obtained a third-party payment license.

According to the business registration information, the current legal representative of Jiefu Ruitong is Lei Jun. The business includes Internet payment, mobile phone payment and bank card receipt, and the business scope covers the whole country.

A person who has been dealing with Xiaomi for a long time told reporters that from the perspective of mobile phone manufacturers, the significance of taking a license is not great, but from the perspective of Internet financial layouts like Ant Financial, Jingdong Finance, etc., the license is of great significance, Xiaomi The practice of buying a heavy license to buy a license shows that Xiaomi has already thought about making finance a sector, not just a tool.

Xiaomi has launched a series of actions in the financial sector in 2016. In addition to the acquisition of the payment of the payment license by Jiefu Ruitong, on June 12, Zhang Jinling, vice president of Xiaomi Group, revealed at the 2016 Lujiazui Forum that Xiaomi Technology will launch the online equity investment and financing platform “Miji Jinfu”, whose CEO is financed by Shanghai Finance. Zhao Minghui, former deputy director of the Market Office, served. According to industry and commerce information, Shanghai Mickey Internet Financial Services Co., Ltd. was established in March 2016 with a registered capital of 100 million yuan.

Subsequently, on June 13, Xiaomi announced that Sichuan Hope Bank Co., Ltd. (hereinafter referred to as “Sichuan Hope Bank”), which was jointly applied by seven Sichuan enterprises including New Hope Group, was approved by the China Banking Regulatory Commission. Xiaomi accounted for 29.5%. Second only to New Hope Group's 30% share, becoming the second largest shareholder. Sichuan Hope Bank has a registered capital of RMB 3 billion and is the first private bank in Sichuan Province. Since then, Xiaomi has entered the banking industry.

Compared with Ant Financial, Jingdong Finance, etc., Xiaomi Finance is relatively scattered at this stage.

The above-mentioned people who have dealt with Xiaomi for a long time said that Xiaomi's business structure is centered on partners and partners are expanding into the financial sector according to their respective business needs. For example, Xiaomi payment is derived from the MIUI business demand that Hong Feng is responsible for. The bank license is derived from Lei Jun's industrial layout, and Xiaomi crowdfunding is more derived from the ecological chain business demand that Liu De is responsible for.

"At present, these scattered financial businesses have no possibility of merger. Because their respective sponsors are different, their independence is relatively strong. If the business structure and top-level design of Xiaomi are rescheduled in the future, the possibility of partial restructuring and merger will not be ruled out. Said the person.

The person said that Xiaomi is the third largest e-commerce company in the country. If it is in normal development, Xiaomi Finance now has at least one prototype of ant gold clothing. Xiaomi’s financial sector is currently showing a significant lag. The main reason is that Xiaomi’s team lacks a partner who leads the financial structure. Otherwise, Xiaomi’s traditional “troika” (mobile phone, Micha, MIUI) is very likely. It is the “four driving”, and with the expansion of Xiaomi and its related product systems and revenue scale, the potential of consumer finance and supply chain finance in the later period is very large.

A person close to Lei Jun told the Caijing reporter that Lei Jun had also felt that Xiaomi Finance should be laid out earlier.

However, Hong Bo believes that it is still too early to say that the layout will be sooner or later. With the gradual liberalization of China's financial regulations, there will be huge opportunities in the future financial industry. Now even the scale of Ant Financial is still too small, and the crux of whether to seize the opportunity lies in Innovation.

For example, he said that Yu'ebao has only used 1.2 million users from zero, and the core of its success is innovation, which brings benefits to users. There are three innovations in Yu'ebao: first, interest is higher than banks; second, treat money as a balance and do not need to redeem; third, zero threshold. "If you don't have this kind of innovation, why do you compete with others?"

Realizing ecological advantages

Xiaomi is a consumer Internet gene. Now, to learn the industrial Internet, Huawei is just the opposite.

With the launch of Mi Pay and the frequent layout of Xiaomi Finance, Xiaomi’s ecological empire has matured.

Xiaomi's ecosystem is based on the user-centered, integrated business model of hardware, software and services. The hardware section is divided into two parts: the first is Xiaomi's self-developed section - Xiaomi mobile phone (including Xiaomi tablet), Xiaomi TV (including Xiaomi box) and Xiaomi router; the second is Xiaomi's ecological chain products.

According to the disclosed figures, Xiaomi has invested in 55 eco-chain companies. In March 2016, the Xiaomi Eco-chain launched a new brand, “Mijia”.

Xiao Zhuo, director of the Xiaomi ecological chain market, told reporters that the company has no performance appraisal requirements for the Xiaomi ecological chain department. Compared with the short-term benefits, Xiaomi hopes to build the big ecology of Xiaomi through these eco-chain companies. "Only if there are enough terminals and sufficient types of products, users can have a collective understanding of smart homes and Internet of Everything, enhance word of mouth, and serve the big ecology of Xiaomi," he said.

Xiaomi's software and services refer to the MIUI operating system and a range of Internet services and content based on the system, including stores, video games, cloud services and more. Xiaomi is also actively deployed in the content. For example, Mi Lian and Beijing Wali Network Technology Co., Ltd. jointly formed "Millet Mutual Entertainment", focusing on two major businesses of games and film and television. In addition, Xiaomi also invested in Youku Tudou, iQiyi, Huace movies and so on. On September 27, Xiaomi announced another partner, Tencent Video.

"Some people sing the millet today, but the value of Xiaomi can't just look at the shipments. This view is one-sided." Yu Jun, the investment manager of Jiyuan Capital, told reporters that Xiaomi's core and strategic foundation must be mobile phones. Needless to say, but today is more than just a mobile phone. Xiaomi's software and Internet services, including a variety of active applications (and distribution), games, e-commerce, finance and eco-chain hardware business, constitute the "frigate" of Xiaomi's ecology.

After collecting payment and financial weapons, can Xiaomi’s more extensive ecosystem add value to Xiaomi? Can Xiaomi rely on its ecological advantages to regain a game in the next round of competition with Huawei?

Apple is the epitome of ecological strategy. Hong Bo believes that the biggest value of the Apple Store is not how much it directly brings to Apple. The added value is that a large number of developers become Apple developers to provide services to users. When the services provided by third parties become users, When it is lacking, it greatly enhances the user stickiness of Apple's mobile phone.

"Apple seamlessly integrates all the services together, and the perfect, consistent experience can only be obtained through Apple." Hong Bo said.

Hong Bo said that there is still a considerable gap between Xiaomi Ecology and Apple Ecology. An important part of this is that Xiaomi lacks the ability to control its entire ecology. For example, downloading the Xiaomi application or playing the Xiaomi game on the mobile phone often does not depend on the Xiaomi mobile phone. At the same time, the products on the Xiaomi ecological chain are single independent individuals, lacking synergy, and a considerable part of the “Mijia” users. In fact, it is the user of Apple's mobile phone, Xiaomi has no way to dominate and control.

Zhou Shipai analyzed the reporters. The ecological strategy has two latitudes in the field of consumer electronics. One is the consumer Internet ecology, and the other is the industrial Internet ecology. The logic of the two is completely different. The consumer Internet is the BAT era, and the backward cost of zero marginal cost; The industrial Internet is mainly focused on forward investment. Relatively speaking, Huawei is an industrial Internet gene. Now, to learn about the consumer Internet, Xiaomi is just the opposite.

He said that if Xiaomi wants to use the consumer Internet to pull back, he needs to pay more attention to the innovation of user fan operation and application software, and respect the fashion and youthfulness of consumer Internet marketing; if you want to pull back from the industrial Internet, you need to work hard, and The supply chain works closely together to make high-value products, because high-value products are the correct values ​​of the industrial Internet eco giant.

"If Lei Jun does not give up the thinking inertia of the successful consumption of the Internet, it will take time to find its own position in the new competition." Another person close to Xiaomi said.