Photo/Hua Ang (NBD)

Feb. 19 (NBD) – Chinese smartphone maker Xiaomi has restructured its smartphone department on Monday, a move to reinforce its mobile phone product R&D system.

This is the third time of Xiaomi's restructuring in the recent half of year, following another two respectively in September and December last year.

The previous reorganization emphasized sales and services as well as other business segments of Xiaomi. This time the company shifted focus to the smartphone unit itself, attempting to promote R&D of phone components.

Smartphone sales, as the largest contributor to Xiaomi's revenue, generated approximately 35 billion U.S. dollars in the third quarter of 2018, up 36.1 percent year-on-year, with increases in both smartphone sales volume and the average selling price.

According to market data provider IDC, Xiaomi ranked fourth in both domestic and global market last year in terms of smartphone shipment.

It shipped 52 million handsets in the Chinese market, while its market share declined by 5.6 percent year over year to 13.1 percent.

But its global shipment registered 122.6 million units in the period, representing a year-on-year surge of 32.2 percent.

Amid the cut-throat competition in the sector, mobile phone makers including Xiaomi gears up for expansion in the high-end phone market to scramble for more market shares.

The high-end phone market still has enormous potential in the future, Jia Mo, analyst at Canalys told news outlet Yicai. The shipment of mobile phones in China posted a decrease of over 14 percent in 2018, yet the number of shipped phones at the price of more than 600 U.S. dollars rose by 10 percent, noted Jia.

Vivo, which stood one place ahead of Xiaomi in the domestic market, released a new brand iQOO, also eyeing the high-end smartphone sector. Models of iQOO will be priced at over 5,000 yuan (739.2 U.S. dollars).

Xiaomi has confirmed to unveil its new flagship model Mi9 on Wednesday, and the starting price of the product is said to go up to 3,499 yuan (517.5 U.S. dollars), compared to 2,699 yuan (399.0 U.S. dollars) for Mi 8.

The company is struggling to cast off its label of low price and target different consumer groups with diversified phone series.

By adjusting the organizational structure frequently, it seeks to spur development of products through clearer strategy and more efficient management.

Early last month, Xiaomi announced the plan to spin off its budget-phone business Redmi as an independent sub-brand. Setting up a new firm enables the firm to divide its product line into two parts.

Mi is aimed to concentrate on the medium- and high-end models, while Redmi will continue to provide cost-effective phones.

This will help Xiaomi rival its counterparts with dual brands such as Huawei.

Moreover, Dongxing Securities pointed out that the whole mobile phone industry will enter a stage in which players compete with each other on comprehensive strength, and Xiaomi will face more challenges in improving the brand image, increasing investment in technological innovation and enhancing its core competitiveness.

Email: zhanglingxiao@nbd.com.cn