Xiaomi’s internet business sees rapid growth in overseas markets with its growing suite of services

As the number of internet users continues to grow, one smartphone manufacturer is hoping to optimise its core internet business to improve its suite of experiences for users. Globally, there are an estimated 5.3 billion internet users today – two-thirds of the world’s population. Across Europe and North America, online penetration rates exceed 90 per cent on average, up from 70 per cent in 2010, according to the World Bank.

With the rapid development of this market, the demand for online services is gaining momentum. For consumer electronics manufacturer Xiaomi, this has proved to be a key area of growth.

Leveraging its customisable operating system MIUI – which is in the process of being upgraded to HyperOS for the global market, and currently boasts more than 623 million monthly active users – Xiaomi is well positioned to expand its internet business portfolio through services including advertising, payments, app and game distribution, and content integration.

“We have built a global internet service ecosystem, and have extended to users and developers all types of devices and markets through diversified services,” said Chan Liu, general manager, internet business department, Xiaomi, speaking at the Xiaomi Internet Partner Conference 2024 in Beijing. “This ecosystem not only provides users with an excellent experience but also helps developers to grow, forming a virtuous cycle of continuous growth and mutual support.” She added that in the future, Xiaomi will continue to develop together with global partners to the benefit of all parties.

Xiaomi’s internet services revenue reached a historical high in 2023, with MIUI seeing record monthly active users both in mainland China and globally. The company doubled down on its efforts in overseas markets, which contributed 30 per cent of its total internet services revenue in the third quarter of 2023.

The company has ambitious plans for its internet services ecosystem that it says will enhance three core service areas key to its global expansion plans: app and game distribution, content integration services, and user growth and customer success.

One key area of this ecosystem is the Global IAP Games Joint Operation, which targets the game distribution sector, helping developers acquire users and increase revenue at minimal cost. This leverages the capabilities of Xiaomi’s official app store GetApps – which has a monthly active user base of more than 260 million people from over 100 markets around the world – as a platform to boost user growth for mobile phones.

GetApps is an ideal platform to boost user growth for mobile games, according to the company. Flexion, GetApps’ most successful game distributor last year, has partnered with Xiaomi, distributing 19 games including Monopoly Go! and Tanks Blitz.

With the support of its operations team, GetApps has conducted promotional campaigns for these games, including app recommendations, traffic exposure and payment discount benefits.

As a result, Monopoly Go! has seen a steady increase in average monthly revenue on the GetApps platform, while the average monthly activation and number of daily active users of Tanks Blitz increased two-and-a-half times compared with the initial launch period. The average daily turnover has increased three times and continues to rise, according to Xiaomi.

To complete its suite of mobile games services, Xiaomi also offers a payment infrastructure covering 400 channels across 100 markets. This allows for seamless in-game transactions – a key revenue stream for game developers. The company’s advertising services are also paying dividends: when the multiplayer online game Mobile Legends: Bang Bang partnered with Xiaomi in 2023, digital advertising on GetApps helped drive new installations to 10 times higher than before.

The company collaborates with industry partners to help brands and app developers reach their target audience and expand user growth, with GetApps at its core. “To work with Xiaomi’s international internet business development team is not only about having access to one of the world’s largest user bases, it is also about gaining the right user insights that are important to our clients,” said Robert Wildner, co-founder and CEO of Avow, a German-based global app company that partners with Xiaomi.

As part of its growth strategy that harnesses its smartphone capabilities, Xiaomi has unveiled Instant Web – the latest addition to a content service ecosystem which includes features such as a web browser, video player and game centre. Instant Web is a proprietary web acceleration framework; it can increase webpage loading speeds by up to eight times, according to Xiaomi.

Research by Portent, a United States-based integrated digital marketing agency, suggests conversion rates decrease significantly with each additional second that it takes to load a webpage. With this in mind, Xiaomi hopes the speed of Instant Web will prove indispensable for e-commerce stores and online retailers.

The company has also introduced the Columbus Monetization Platform, allowing developers to better monetise the traffic they receive on their apps. This is achieved by offering advertisers a range of budget options and real-time bidding. With such flexibility, developers are able to maximise the commercial value of their user base and earn more through advertising on their apps.

All of these offerings are intended to play a key role in the expansion of Xiaomi’s internet services business. The company is committed to a collaborative approach, made apparent by its 2024 international internet partner strategy titled “Grow with Xiaomi”.

“Our sustained growth hinges on our collective effort to continuously create value for all participants in the Xiaomi internet services ecosystem, including our users, partners and suppliers,” Chan said.

Having the advantage of manufacturing its own smartphones, Xiaomi can directly address the pain points which affect advertisers. In this way, the company believes its goals complement those of its partners and clients looking to reach a wider audience, better target their offerings and reduce operating costs.

Xiaomi has also opted for a developer-friendly revenue-share policy, emphasising the idea of growing together. “Strengthening collaborations with both new and existing partners to share global market successes will enhance how mobile, internet and digital technologies serve our society and every individual,” Chan said.