Xiaomi appears to be moving towards the software market as it has announced plans to acquire a 3-percent stake in Kingsoft for HK$527 million (RM242 million). It appears that the fastest growing smartphone manufacturer is continuing to diversify its product portfolio. Whether it intends to integrate more software options into its products is still a matter of debate.
Kingsoft currently makes productivity and enterprise software, although it also has experience in building PC games. Most would identify Kingsoft with its Office suite of productivity tools that are often used as a free alternative to Microsoft Office. The fact that Kingsoft Office for Android is freeware should make it all the more familiar to users.
This move could see Xiaomi create a stronger software eco-system for its users. It could also potentially be setting the stage after teasing a gaming product set to be revealed tomorrow; considering that Kingsoft once made PC games.
On the other hand, Xiaomi co-founder and CEO, Lei Jun, is also the founder and chairman of Kingsoft. And this move could just be a consolidating of holdings. It should be noted that the 3-percent stake is being bought from Chinese internet giant Tencent which is reducing its stake in the company to 9.6-percent.
The sale of shares is scheduled to be concluded by the end of January.