Xiaomi bulking up on patents with help from Microsoft

High-flying Chinese smartphone supplier Xiaomi is bulking up on its patents for smoother international expansion by forming a partnership with software giant Microsoft, the company said Wednesday.

Xiaomi said it had purchased nearly 1,500 technology patents from Microsoft covering the fields of video, cloud technology and wireless communication.

Microsoft transferred to Xiaomi patents to help ease the firm’s operations in new markets, according to a spokesman from Microsoft.

“Xiaomi is looking to build sustainable, long-term partnerships with global technology leaders,” said Wang Xiang, senior vice president at Xiaomi, who leads its supply chain and intellectual property teams. He used to work at semiconductor giant Qualcomm as its president for greater China.

Faced with declining smartphone sales at home, Xiaomi is trying expand to other countries, including India and the US.

It partnered with Google to release a TV set-top box in the US last month and its smartphones are already on sale in India.

“IP (intellectual property) is something that Xiaomi is lacking in,” said Tay Xiaohan, an analyst from research firm IDC.

“It is definitely a move to help them with their international expansion plans, especially as it seems to move beyond developing markets and to one day [see them] enter the US market,” Tay said.

The agreement builds on existing collaborations between the two, including pre-installing Microsoft’s Windows 10 operating system on Xiaomi’s Mi Pad tablet and adopting Microsoft’s technology to power the Mi Cloud service.

Part of the partnership will see Microsoft’s productivity software suite Microsoft Office and voice call and messaging software Skype pre-installed on Xiaomi smartphones including its Mi 5, Mi Max, Mi 4s, Redmi Note 3 and Redmi 3, starting from this September.

Xiaomi said the basic editing functions in MS Office will be free while advanced functions such as tracking editing changes will require a subscription to Microsoft’s Office 365 service.

Global sales of smartphones have slowed in recent months and Xiaomi is also challenged by other companies that have newly entered the market.

According to IDC, global smartphone suppliers shipped 334.9 million units during the first quarter of this year, which represents 0.18 per cent growth from the same period in 2015. Xiaomi, the fifth largest company in the sector last year, has been overtaken by domestic rivals OPPO and Vivo.