Xiaomi Forms 500-Person AI Team as It Looks to Expand Abroad

Chinese electronics and software company Xiaomi announced a new team dedicated to artificial intelligence research during a product release conference held in Shanghai today. The 500-person AI research team will use the data Xiaomi has collected over the years from various devices to improve its in-house intelligent assistant, Xiao AI. The timing of the announcement also coincided with the introduction of two new Xiaomi products, both powered by its Xiao AI assistant. The first is Xiaomi’s new flagship smartphone, the Mi Mix 2S, positioned as a direct competitor to the Apple iPhone X in China, but for the half the price. It also announced the Mi AI Speaker Mini, which is a smaller version of its Mi AI Speaker released last year.

Xiaomi Looks Abroad

Earlier this month Xiaomi Chairman Lei Jun confirmed that the company has plans to enter the U.S. market “by end 2018, or by early 2019.” It has long been rumored that Xiaomi would like to come stateside and with an initial public offering planned for later this year with an estimated target valuation of $100 billion. Today’s announcements are no coincidence. Entering the US market would greatly increase Xiaomi’s potential target market but there are considerable challenges.

The Xiaomi and Microsoft Potential Partnership

One of these challenges is having a capable English-speaking intelligent assistant, which if you look at the launch of Samsung’s Bixby, is no easy feat. The question remains whether Xiaomi’s newly formed artificial intelligence team will be behind that initiative or if it will turn to an established partner like Microsoft for assistance. Xiaomi and Microsoft have already partnered on one device, the Cortana powered smart speaker Yeelight. Aggressively priced at about $30 USD, the Yeelight is comparable to the Echo Dot or Google Home Mini but only available in China, a market that Amazon and Google have yet to enter.

Integrating its products with Microsoft Cortana would be a win for both companies in the US market. First, it would allow Xiaomi to enter the US market quickly, as Microsoft Cortana is already a capable voice assistant with English language support. It would give the company access to other Microsoft technologies, like Bing and Skype. In turn, Microsoft and its voice assistant would expand its device distribution, something the company sorely needs in the consumer device market, even in the US. The two companies have also already signed a memorandum of understanding to work closing in the cloud, AI and hardware markets, which means Microsoft could also increase its foothold in China and expand its cloud platform Microsoft Azure. With both companies set to greatly benefit from a partnership, a Microsoft-Xiaomi partnership for the U.S. is a likely outcome.

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