<h4>Chapter 235: Announcing the Entrance into the Field of Home Computers</h4>
<strong>Trantor: </strong>Nyoi-Bo Studio <strong>Editor: </strong>Nyoi-Bo Studio
It was like doubling their power. There were huge implications in Hua Yao joining the Xing Hai Alliance. Hua Yao was the hegemon in themunications sector. They sold thergest amount of mobile phones in the world, had countless patents, and earned annual revenues in the trillions. For example, if Hua Yao gave all their orders for chips that were used in their phones and 5Gmunication devices to Zhongxin International, it would be a contract worth tens of billions. If Hua Yao chose to use only domesticponents for their products, such as memory chips from Purple Ray and NAND storage from Da Jiang, that would mean contracts worth another tens of billions. This would also lead to a loss of business for countless other foreign manufacturers.
In short, the alliance between the twopanies was an alliance between the strong. It was akin to the champion and the runner-up joining hands to get rid of the third and fourth ranked yers. There was no need to put into words who would be the final winner and loser.
...
After Zhongxin International had conquered the production techniques for the 7-nanometer chip and Hua Yao had joined the Xing Hai Alliance, Chen Jin did an inventory in private. He was calcting the number of trump cards he had umted. “There’s not much to talk about when ites to the intelligent robots. There is nopetition for both the cleaning robot (Wa-wah) and the household service robot (Bang Bang). Thebined sales volume of both products is about 20 million units annually, which means a profit of about 50 billion. The Little Star learning machine has progressed to the third generation. A total of almost 150 million units have been sold to date. The markets for the primary school students, the junior high schoolers, and senior high schoolers have almost reached saturation point. There are only two ways that I can only make money from this: the new students who entered the schooling stageter anding up with new editions. Only a maximum of 20 million units will be sold every year from now on. This will generate 70 billion of profits. However, the ‘Little Star, Fourth Generation’ that will be specially made for college students, as well as the ‘Intelligent Brain Terminal’ that can be more conveniently used by consumers in general, are currently under development. They will be distributed in the market about two to three yearster. There is a potential to make trillions more from the market when ites to knowledge products.”
He continued, “The software product of the Work Assistant is mainly targeting the programmers. It brings in a monthly revenue of about 5 billion. 70% or even more of the revenue is profits... We can earn more than 40 billion every year. Besides the programmers, there are many R&D organizations that need the Work Assistant. The functions of this software can be expanded continuously. It will be used by tens of millions of people in the future and bring in tens of billions in monthly revenues. The special effects rendering engine for movie-making and the game development engine could generate an estimated ten billion in profits every year. We charge a minimum of 1 billion to build one virtual factory. The clients can either pay via cash or give us shares in theirpany. The barriers to using it are greater, but we cannot publicize it for now in order to avoid causing an earthquake on a geopolitical level... We can only let insiders use it. Making the Star Cloud system was purely spending money for the sake of self-entertainment. Currently, it brings no benefits, yet it had already burned through some hundreds of billions. Before we finally eliminate the Android system, I estimate that the annual expenditure for this project will be at least 30 billion... It consumes about 100 million every day. Moreover, Xing Hai Technologies receives dividends from the many differentpany shares that they hold. We receive more than 10 billion in dividends per year, but expenses for investment are more expensive.”
In summary, Chen Jin would earn about 180 billion every year. Excluding the sries of 30,000pany staff and various operating costs (about 30 billion), including various types ofrge-scale R&D projects, investment activities, and other costly activities... The total annual expense was at least 150 billion.
Moreover, he was the type who spent as much as he earned. But, he still felt that he was not earning enough. The money was still insufficient. He had to start a few more projects and earn more money. Then, what kind of project should he start?
“I’ll try to avoid robbing the rice bowls of the local monopolies and businesses. But... there’s no need to be so polite about foreign businesses and their profits. I won’t be changing my style of taking every single grain of rice from them.” So, what were the major profitable businesses that belonged to overseaspanies? Which of them could Chen Jin devour?
Homeputers, otherwise known as the PC. When it came to personalputers, only the motherboards, memory, hard drives, power supplies, chassis, fans, and otherponents, could be produced domestically. The two most profitable products, the CPU and graphics card, were monopolized by several foreignpanies such as intel, AMD, and Nvidia amongst others. For the operating system, there was Microsoft, who had been enjoying their windfall for decades. Their good old days were about toe to an end... At least in Z country’s market. They were about to meet their strongest match.
The project for the development of the home PC (including the operating system) had begunst year. They had achieved some results by now. It was estimated that they wouldunch the first 100% domestic PC by next year. The bottomyer architecture, CPU, graphics card, and operating system of this PC would all be locally made. Hence, it could be said that the intention to make a 100% domesticputer had been in Chen Jin’s ns all along. He would fix onest weakness and make money from it at the same time.
However, many people were negative about this project. The hardwareponent of theputer was hardly profitable and it was difficult to distribute the newputer operating system on a wide scale. It was also difficult for users to change their habits, not to mention how inconvenient a new operating system would feel. However, Lei Xiao Jun was positive about his ability and invested a sum of money into the project. As for Chen Jin, he was even more determined about this project and he invested tens of billions into it. Because he strongly believed that the home PC by Xing Hai Technologies would definitely achieve sess!
...
On the 18th of July, Xing Hai Technologies announced that they would be entering the field of PCs and that they nned to create a 100% domestically producedputer.
The inte was in an uproar again. The majority of reviewers from the scientificmunities andizens with considerable knowledge about this topic were not enthusiastic about this. There were many voices predicting their failure.
“What is the current era? The homeputer is about to be eliminated. They’re still trying to board this ship?”
“There is still a market for the home PC. Everyone has to get one for work, studies, or entertainment. It’s just that this market is stagnant. There have been no significant updates in the performance of the PC for nearly ten years. Nowadays, we can buy a high-endputer and use it for 5 or even 10 years and it still wouldn’t be outdated. Who would ever want to buy a new one?”
“Things do feel a lot safer when a domesticpany is making ourputers. They would create their own architecture and develop their own operating systems. But, this doesn’t mean that consumers would buy it. They would also have to create aplete ecosphere of applications. But Xing Hai Technologies...” At this point, the user stopped typing. Xing Hai Technologies was crazy.
“I suspect that Xing Hai Technologies definitely has the skills to produce a PC with their technological capabilities. But no matter how good your technology is, it doesn’t mean that the market will respond well to your product. This is especially true for users who are used to the Windows OS. It’s very difficult for them to change their habits and adapt to a new OS.”
“Ok, I’ll reserve my opinions. But it’s much less profitable to produceputers aspared to mobile phones. Many buy a newputer only once every five to ten years. The profit from the hardware is not high. There are profits to be made from the software, but they would need to have arge number of ready users. Can yourputer create an impulse in consumers to change their oldputers so that you are able to sell millions and even tens of millions of your product?”
“It’s good that someone is doing this. Recently, the prices of the memory chips and hard disks have been falling, causing many to be struck with the impulse to DIY theirputer. However, the prices of CPU chips and graphics cards have been increasing. By entering this field, Xing Hai Technologies might just be the shark in this pool and teach the likes of Intel and Nvidia a lesson. I think that’s pretty good. Who knows, I might buy aputer from Xing Hai Technologies.”
...
The news of Xing Hai Technologies announcing their entrance into the field of homeputers spread to the foreign media. The foreignizensughed until their stomach hurt. They ridiculed thepany’s decision.
“I admire their bravery.”
“I’m reminded of Don Quixote challenging the windmills.”
“Even if we give them another 100 years, they’ll still be using theputers that we invented.”
“Hey, stupid farmer, you’re facing a giant.”
The upper management from Intel, Nvidia, and otherpanies held a meeting to discuss the matter. They did not attach much importance to the issue. The challenge presented by Xing Hai Technologies was not taken seriously at all.
Since IBM hadunched its first homeputer in the 1980s, they had been involved in squeezing out meaningless updates for almost 50 years. From the architecture to software ecology, they had established an all-epassing regime. But apany wanted to challenge this kind of regime now?
They could onlyugh in contempt.