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Xiaomi Launches Consumer Mi Drone

May 25, 2016

A DJI challenger appears in the Chinese drone market

The Mi is a quadcopter with a sleek (and familiar) design, featuring a spherical stabilized gimbal camera. 

Xiaomi, a Chinese electronics company, announced its release of its Mi drone on Wednesday, May 25.

The company is no stranger to the tech marketplace — it is the world’s fifth-largest producer of smartphones, and has recently expanded into offering new consumer electronics including headphones, fitness trackers, and smart air purifiers.

And now, the company is expanding into the lucrative consumer drone market.

All about Mi

In February 2015, rumors began to surface that Xiaomi was investing large amounts of money in a new unmanned aerial vehicle (UAV) company called Guangzhou Feimi, which is producing the new Mi drones for Xiaomi.

In an English live-streamed announcement on Facebook, Xiaomi’s Global Vice President Hugo Barra discussed the technical specs of the Mi drone. Barra emphasized that the goals for the Mi drone are affordability, ease of flight, and portability.

The Mi drone uses GPS, GLONASS (essentially, the Russian equivalent of GPS), and a vision-based positioning system to orient itself. A downward-facing camera sensor determines the altitude of the drone to perform autonomous landing functions and help orient the drone should GPS or GLONASS be unavailable.

The Mi drone's controller is fairly standard, including a retractable smartphone slot and return-to-home button, as well as camera and gimbal controls.

There will be two models of the Mi drone — a “basic” 1080p and a 4K model. Both versions have a standard controller that operates the camera and gimbal, with a retractable slot to hold the iOS or Android smartphone used as an FPV interface. A unique feature is the location of the video/photo capture button, which both appear on the backside of the controller.

Users of the Mi will have 27 minutes of flight time, with various autopilot features including return-to-home, automatic takeoff and landing, flight planning, and orbit. The recommended flight range for the Mi is 2 kilometers — comparable to other consumer drones, but nothing groundbreaking.

The promotional video released by Xiaomi showcases some footage captured by the drone:

"We thought we could make the same high-end technology […] for a much more affordable price."

A (business) model for success

Xiaomi offers advanced tech products at highly competitive prices. Its Mi Band fitness tracker costs only $14.99, and has specs comparable with competitors like the Fitbit Flex, which comes in at $99.95.

But Xiaomi is best known for its highly competitive smartphones. The Xiaomi Mi 5 smartphone, released in February, is priced at $410. The iPhone 6, released in September of last year, currently costs $549 on apple.com. Despite very similar technical capabilities, Xiaomi continually manages to price their products at just above material cost.

With the basic model of the Mi drone priced at $380 and the 4K at $450, Xiaomi is certainly carrying this business model into its UAV offerings. These price points have the potential to disrupt the consumer drone market, with fellow Chinese drone producer DJI pricing its new, highly popular Phantom 4 models at $1,399.

In the live video, Barra explained Xiaomi’s incentive for entering the drone market. “A drone is a great example of a product that is typically an expensive product for rich people. That’s the reality. We thought we could make the same high-end technology […] for a much more affordable price,” he said.
How low can you go?

Xiaomi is able to sell its products at these prices by keeping its overhead low — it does not sell out of physical storefronts, and relies on social media and word-of-mouth to advertise its merchandise.

This stands in stark contrast to DJI, which has recently invested in two upscale retail storefronts: one in Shenzhen, China, and a second in Seoul, South Korea.

The company also tends to release products in small batches in order to match supply to demand, as opposed to over-producing. This is likely why Xiaomi has chosen to crowdfund the 1080p model of the Mi through its Mi Home app. This will allow the company to both raise money and assess demand through preorders before producing or shipping units.

Xiaomi will be shipping beta versions of the 4K-enabled Mi to a small number of customers in July.
Xiaomi's business model is drastically different than its competitor, DJI. DJI's retail locations are meticulously designed, exuding a sense of luxury. Xiaomi, on the other hand, keeps costs low by foregoing storefronts entirely.
Promises, promises…

As tantalizing as these features might be, the drone community is well-acquainted with new, too-good-to-be-true products that promise far more than they can deliver. Many viewers of the live stream called for a flight demo, but were ultimately denied their request.

If the Mi can deliver on its many promises, it would pose a significant threat to consumer drones currently on the market in both price and performance.

But according to International Business Times, Xiaomi has no intention to sell the Mi drone in the U.S. With DJI’s largest market being U.S. customers, this could have a significantly detrimental effect on the Mi’s overall sales.