HONG KONG -- No longer content to be known for budget devices, Chinese smartphone makers are moving faster into the high-end segment with models that claim to match some functions offered by top-of-the-line Samsung Electronics and Apple phones, but at lower prices.
An early mover is Xiaomi, which raised $4.7 billion in a June initial public offering in Hong Kong. The Beijing-based company last week launched Poco, a brand targeting tech-savvy gamers outside China. Poco means "small" in Spanish.
Pocophone F1, the first product under the brand, features a 6.18-inch high-definition screen, a Qualcomm Snapdragon 845 system chip and dual cameras backed by artificial intelligence technology. The phone comes priced between 20,999 rupees and 28,999 rupees ($300 and $415) in India, varying slightly in other markets including Hong Kong, Indonesia and France.
"The geeks truly understand smartphones, and they can bring us a very good reputation if we could serve them well," Robin Zheng, head of software at Poco Global, told the Nikkei Asian Review in an interview Monday after the product launch in Hong Kong.
To keep costs low, Zheng said, the phone offers few of the fancy but less practical functions in order to prioritize the core features. Without naming the iPhone X, he called it "ridiculous" for brands to sell phones at $999 that excel in every category.
Xiaomi plans other specialized models to accommodate consumer groups with different preferences, Zheng said.
The Poco launch fits Xiaomi's move toward a premium strategy at home. In China, Xiaomi raised the average retail phone price by 25% on the year to 952.3 yuan ($140) in the first half of 2018 thanks to robust sales of its premium Mi 8 model, priced above 2,000 yuan.
Other Chinese brands also see the need for premium offerings and specialization to stand out amid slowing momentum in the global smartphone market.
This shift comes after Chinese brands including Xiaomi, Huawei, Vivo and Oppo squeezed Samsung out of their home market. The South Korean company's share in China has fallen below 1% in the past four years from 15%.
After establishing a collective dominance in the mass market, the Chinese brands are advancing to the more sophisticated high-end segment.
ZTE, under its Nubia brand, released gaming smartphone Red Magic early this year. Huawei collaborated with German camera maker Leica in launching the P20 smartphone model featuring three cameras.
Vivo debuted its Nex series smartphone with a 6.59-inch display powered by a 2.2 gigahertz octacore processor this summer carrying a retail price starting at 3,898 yuan. Oppo rolled out its flagship Find X model, which boasts a 6.4-inch panoramic arc screen and stealth 3D camera with a price tag of 4,999 yuan.
Moving to high-end markets will become a trend for Chinese smartphone makers as growth slows, IDC analyst Wang Xi said. Selling premium phones offers better profits and lets the companies build their image, he added.
"The competition in the future is about the quality and brand," Wang said.
Nikkei staff writer Coco Liu contributed to this report.