Hugo Barra resigns from Xiaomi, says he’s returning to Silicon Valley

PUBLISHED : Monday, 23 January, 2017, 3:18pm
UPDATED : Monday, 23 January, 2017, 10:59pm

Xiaomi’s vice president of international Hugo Barra on Monday announced that he has resigned from the company, citing health reasons as the company continues to battle its declining market share in the Chinese smartphone market.

Barra, who left Google for Xiaomi in a high-profile move in 2013, had been the face of the Chinese smartphone maker’s global operations and played a major role in helping the company to enter the Indian smartphone market. Barra will be succeeded by Xiaomi senior vice president Wang Xiang, according to Lin Bin, the company’s co-founder and president.

Under Barra’s charge, Xiaomi entered Southeast Asian markets such as Singapore, Malaysia and Indonesia, as well as markets such as India and Poland.

Earlier this month, Xiaomi said that it had exceeded US$1 billion in revenue from the Indian market in 2016, after just two years of operations. According to data by IDC, Xiaomi is the third largest player in the Indian market with a market share of 10.7 per cent, trailing Samsung and Lenovo in the No. 2 spot.

But back home, the company is struggling to regain its foothold of the smartphone market.

Once the darling of the Chinese smartphone industry, Xiaomi was valued at US$45 billion at its peak in 2014 and received US$1.1 billion in funding that year from investors, after it narrowly beat Samsung as the top smartphone vendor in China with a more than 12 per cent market share.

Since then, Xiaomi’s market share in the third quarter of 2016 has fallen to 8.7 per cent, a 42 per cent decline from 2015, according to data from IDC Asia-Pacific. Oppo led the market with a 17.5 per cent market share, and Vivo came in second with a 16.7 per cent share of the market.

In a Facebook post addressed to Xiaomi’s fans, Barra referred to his relocation from Silicon Valley to Beijing as “nothing short of spectacular in every way”.

“I can proudly say that Xiaomi Global is the first baby I helped bring into the world,” Barra wrote.

However, he added that the last few years of living in a “singular environment have taken a huge toll on my life and started affecting my health”.

Beijing is notorious for poor air quality and smog that regularly blankets the city. On New Year’s day, the air quality index released by the municipal environmental protection bureau reached 482, just points shy of the maximum 500 mark where the scale tops out. The air pollution afflicting Beijing and the rest of China has prompted the Chinese government to take active steps in combating smog levels, including limiting factory emissions and forcing steel and coal companies to slash output.

Brazilian-born Barra stated that it was time to return to Silicon Valley in the US, and added that he would remain as an advisor to Xiaomi “indefinitely” as the Chinese company moves forwards with its expansion plans into international markets.

He added in his post that he will transition out of his role as vice president of international following the Lunar New Year.

Kitty Fok, managing director of IDC China, said that Barra’s departure will likely diminish Xiaomi’s global branding in its new markets.

“Barra has a good global branding because of his experience at Google and he has recognition in the industry. When he joined left Google to join Xiaomi, the world suddenly took notice of this Chinese company,” Fok said. “Once Barra leaves, it will be difficult to find another person who can market Xiaomi as effectively overseas.”

Fok added that the impact will likely be larger on Xiaomi’s newer markets, excluding India, since the company has already seen positive results in that market.

Tay Xiaohan, senior market analyst at IDC Asia-Pacific, said that Barra’s departure and its struggles in the Chinese smartphone market will not inhibit Xiaomi’s international plans.