Published in Mobiles

Alibaba invests $590m in Meizu

by on09 February 2015


Let's show Amazon how it's done?


Chinese e-commerce giant Alibaba is investing $590m in Meizu, one of China’s up-and-coming smartphone outfits.

The company announced on Monday that it plans to buy a minority stake in Meizu. While $590m does not sound like much for a company with a market cap of $212bn, some analysts are already questioning the decision.

Reuters carried statements from analysts who were not impressed, and one of them described the deal as an “expensive experiment”.

"My concern is that some internet players are confusing being able to just spend a couple hundred million dollars to buy a piece of hardware that looks pretty cool but is essentially a copy of what Apple has done and what Xiaomi has done," said RedTech Advisors managing director Michael Clendenin.

Canalys analyst Nicole Peng said Meizu has managed to boost its shipments from a few hundred thousand units in previous years to about 2 million units in Q4 2014. However, even with 2 million units per quarter, the company holds less than 2% of the domestic market, said Peng.

Last modified on 09 February 2015
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