At 9:00 AM on July 26th, OFweek Smart Home Network News reported that Tang Mu, the General Manager of Xiaomi's Exploration Lab, hinted at a new product release in a Weibo post saying, "There will be one more thing announced today, take a guess right, and I'll pump one." Many assumed this "one more thing" would be a smart voice speaker, but Tang Mu responded ambiguously with "right, not right."
In the end, Xiaomi unveiled the Mi AI Speaker priced at 299 yuan. Part of the audience seemed confused by the response. What exactly was the issue? Later, images were shared showing the device. Some wondered who would become the Chinese version of Amazon's Echo. When asked, many smart speaker industry practitioners mentioned Xiaomi frequently.
The reasons cited included Xiaomi's strong integration of hardware and software, its extensive distribution channels, and financial resources. In fact, Lei Jun had previously mentioned during this year's Two Sessions that Xiaomi had established an exploration lab last year, and significant AI products would soon be released. Besides the Mi smart speaker, there were hints of other potential products.
Given that Amazon Echo has shipped tens of millions of units, validating this approach, companies like Google, Microsoft, and even Apple have followed suit. Yet, none have entered the Chinese market, leaving Xiaomi with no reason to cede this territory.
When would it launch? How much would it cost? These questions lingered among competitors. Recently, a CEO of another smart speaker company admitted to Lei Feng Network that his biggest fear was Xiaomi releasing a 399-yuan smart speaker to disrupt the market.
Unexpectedly, this prediction came true sooner than expected.
The Illusion of Smart Homes
Lei Feng Network learned that the Mi AI Speaker's hardware was actually completed six months ago. The main reason for the delay was unresolved issues, which might explain Tang Mu's earlier "misstep." After the event, he clarified to Lei Feng Network, "This isn't the main speaker, but rather a smart home device."
This statement raised some confusion. Both users and industry insiders initially envisioned smart speakers primarily functioning as control centers rather than just audio devices. Demo videos for Amazon Echo and Google Home also emphasized "smart" capabilities over sound quality.
This reveals a misconception. Research by Experian and Creative Strategies found that the most commonly used features of Echo are music playback, lighting control, and alarm settings. Among features tried at least once, the top three are alarms (85%), music playback (82%), and news broadcasts (66%), while services like car rentals received only 6% usage.
In other words, although voice interaction is more efficient, in real-world scenarios, smart speakers still struggle to surpass traditional interaction methods. Thus, it's predictable that the role of a "smart home hub" played by the Mi AI Speaker won't satisfy early adopters. Clearly, this doesn't align with Xiaomi's ambitions.
Complicated Games Ahead
A month ago, Tang Mu returned to Tencent to address music content on smart speakers, jokingly calling it "going back to brush his face." Before joining Xiaomi, Tang Mu founded Tencent's CDC. During his tenure, he regularly met with Pony Ma to present CDC's designs.
In China's music copyright market, Tencent dominates with QQ Music, KuGou Music, and Kuwo Music controlling 90% of the market. For Tang Mu, securing music rights for the Mi AI Speaker meant reconnecting with old contacts.
The process proved more challenging than anticipated. When asked about progress, Tang Mu stated, "The situation is complicated. Copyright holders, music platforms, device manufacturers, and solution providers are entangled in a complex web, and it confuses even me. But there's still time for beta testing, and we will definitely secure the rights."
One indicator of Xiaomi's expectations for this product is that internal discussions considered pricing at 399 yuan before settling on 299 yuan. This suggests Xiaomi aimed to penetrate the smart speaker market aggressively. Naturally, this also means reaching higher shipment volumes to break even.
During this year's CCF-GAIR conference, Chen Zhiliang, CEO of VoiceChip Technologies, told Lei Feng Network, "If smart speakers offer both sound quality and content at prices comparable to Bluetooth speakers, the latter won't survive. By then, you might realize the 'smart speaker' category is somewhat underestimated, but its volume will be substantial."
In short, smart speakers rely on replacing Bluetooth speakers, focusing primarily on content—where Tang Mu's earlier ambiguity lay.
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