In the business world, every lucrative opportunity has always attracted a multitude of predators.

In 2015, Frank Wang, who had fallen out with the U.S. government, rarely accepted an interview with foreign media. When asked by a Forbes reporter about DJI's competitors, he named XAG and Zero Tech. However, these players in the drone sector had already been easily defeated by DJI.

A decade later, when he once again accepted an exclusive media interview, his list of competitors had grown significantly. From agricultural drones to panoramic cameras, from microphones to gimbals, DJI's business reach extended into more areas, with each business line corresponding to an established company.

Especially in the pocket camera sector pioneered by DJI, blockbuster products like Pocket, which are both critically acclaimed and commercially successful, are being targeted by an increasing number of manufacturers. Unsurprisingly, smartphone manufacturers like OPPO, Vivo, and Xiaomi, as well as sector leaders like Insta360 and Hohem, are all set to release Pocket-like products this year.

Over the past few years, apart from some employees leaving to start their own businesses, DJI has generally operated smoothly and effortlessly. Its consumer drones remain unrivaled, while its imaging sector has diversified successfully, achieving both revenue and profit growth. However, in the ruthless business world, no one can remain unchallenged. Behind the scenes of tranquility, DJI must continually respond to waves of challengers at its doorstep.

01

DJI started with flight control systems, and its initial business model was straightforward. Frank Wang listed products on model aircraft enthusiast forums, selling a system for 200,000 yuan, targeting large state-owned enterprises. These companies needed to demonstrate their embrace of cutting-edge technology with model aircraft in front of leaders, after which the products were typically locked away in glass cabinets.

Although profitable, Wang realized this approach was unsustainable, not scalable, and not a product-oriented mindset. He aspired to create a drone that consumers could fly straight out of the box.

With the rise of multi-rotor drones, DJI quickly gained traction through its Steady playing style (steady approach) and product-first mindset. In 2013, DJI launched its first blockbuster product, the Phantom 1, its first quadcopter drone. Previous drones were difficult to operate and expensive. The Phantom 1, however, was ready to fly out of the box, requiring no complex assembly, and priced at just $679, quickly capturing the non-professional market.

A year later, with virtually no market investment, DJI's drone sales surpassed 400,000 units, and revenue quadrupled. In 2013, DJI's year-end bonus was a Volkswagen Golf; the following year, it became a Mercedes-Benz.

Many Hollywood celebrities and Silicon Valley moguls were using DJI drones, and DJI sponsored several U.S. TV shows. Wang once attended an industry summit where he displayed a PPT listing prominent fans of DJI drones, including Bill Gates, Mark Zuckerberg, and Steve Wozniak.

DJI's dominance in the consumer drone sector, with a market share consistently above 70%, is attributed not only to its steady accumulation of technical advantages but also to the poor performance of its competitors.

At the time, a wave of drone startups emerged domestically and internationally. Domestic players like XAG, Zero Tech, EHang, Yuneec, and Autel Robotics received substantial capital backing, while overseas, companies like Parrot and 3D Robotics emerged. GoPro also entered the drone sector from the action camera market.

However, most of these companies were short-lived. XAG shifted to the agricultural sector, Zero Tech went bankrupt, Yuneec, backed by Intel, exited the market, and Lily, unable to secure funding or produce drones, declared bankruptcy in 2017. 3D Robotics struggled and pivoted to the enterprise market. Parrot, the pioneer of quadcopter drones, later exited the consumer drone market.

GoPro once had a honeymoon period with DJI. Early DJI drones did not integrate cameras, requiring users to DIY. DJI's gimbals defaulted to recommending GoPro, and GoPro used DJI drones for aerial filming in its product launches.

This seemed like a strong partnership with complementary ecosystems. DJI's Phantom 2 was initially intended to be a white-label product for GoPro. However, GoPro, with greater brand recognition, demanded two-thirds of the profits, an unequal deal that Wang could not accept, leading to a fallout.

GoPro decided to develop its own drones, but its first model, Karma, delivered late, was quickly recalled due to quality issues, and ultimately forced GoPro to abandon the drone sector. To this day, a Karma drone is displayed in Insta360 founder Liu Jingkang's office as a reminder of the respect owed to the hardware industry.

Xiaomi, then riding high, did not miss out. In 2016, Xiaomi released a drone priced at 2,499 yuan, with Lei Jun hosting a livestream for the product. However, livestreams are notorious for product mishaps. During the livestream, the gimbal camera Crispy falling on the desktop (clattered onto the table), and during the subsequent flight test, the drone crashed due to a dead battery, creating an embarrassing scene.

More troublingly, FiMI later faced a series of quality issues, leading to a wave of negative feedback. The following year, Xiaomi Mall removed all drone products, and FiMI gradually faded into obscurity.

In fact, Wang had approached Lei Jun to sell DJI's flight control technology to Xiaomi. However, Lei Jun's plan was for DJI to collaborate with Xiaomi, integrate into the Mi Ecosystem, and pursue extreme cost-effectiveness, selling products through Xiaomi Mall. The two ultimately parted ways. Lei Jun turned to invest in another more cooperative team, launching FiMI.

Internet giants without hardware expertise also set their sights on drones. In 2016, Tencent collaborated with Zero Tech to launch a follow-me drone, a project led by Tencent Interactive Entertainment. However, the product failed to make a splash, with multiple delivery delays, and only a few users receiving beta units. This once again demonstrated that internet companies struggle with hardware.

Later, when Liu Jingkang reviewed DJI's past competitors, he concluded that many lacked patience.

DJI quickly unified the consumer drone market. In 2015, Forbes ran a cover story on DJI titled "Bow Down to Your Drone Overlords," and even the Prime Minister told Wang, "You're a star."

That same year, Wang rarely appeared at Shenzhen University's opening ceremony. Normally humble and low-key, Wang was then full of confidence: "In the consumer drone market pioneered by DJI, everyone is chasing our footsteps. This may be the first product in modern Chinese history capable of leading global tech trends."

In 2016, with the release of DJI's Mavic Pro, a foldable drone with significantly high performance and cost-effectiveness, DJI nearly swept the consumer drone market. From the Phantom to Mavic and Inspire series, DJI's drone models achieved great success. According to statistics, in 2017, 19 sizable companies competed with DJI. A year later, this number dropped to seven.

Some netizens even joked that DJI's only competitor in the consumer drone sector was the UOM (Civil Aviation Administration).

02

In public perception, drones represent a market with high R&D investment but relatively modest scale, resulting in a situation where large companies dismiss it, and small companies cannot compete.

Drones may seem unremarkable, but they involve a long chain of technologies and industries, including flight control, image transmission, gimbals, and structural miniaturization, all of which test technological accumulation. While some can assemble a drone from parts bought in Huaqiangbei, the experience varies greatly.

This gave DJI, focused on R&D and product development, an opportunity to establish a deep moat in the drone sector through continuous technological investment and product refinement.

Before DJI's first-generation drone launch, it had already overcome challenges like vibration reduction, high-speed turning, and point-of-interest flight, achieving full control over the supply chain, from brackets and remote controls to propellers and gimbal rings.

Technological accumulation and product focus have consistently played key roles in DJI's development. Through vertical integration, DJI develops everything in-house, from underlying chips, flight control, gimbals, image transmission, and cameras to final assembly. Combined with large-scale procurement, DJI secures upstream pricing power.

Despite having virtually no competitors, DJI maintains high R&D investment, preserving its absolute advantage in drones and imaging.

This focus on technology and products allowed DJI, dubbed by U.S. media as the company most resembling Apple, to gain numerous users with virtually no marketing investment in its early stages.

However, this business has an inherent drawback: the market is not large enough. As early as 2016, Wang judged, "The drone market is nearing saturation, and DJI's revenue may peak at 20 billion yuan."

Having dominated the consumer drone market for years, DJI realized that industry ceilings posed the biggest growth bottleneck. At the time, DJI pursued two growth avenues: one was industrial drones for agriculture, power inspection, surveying, emergency rescue, etc.; the other was entering the imaging sector with action cameras. Flight control and gimbals, DJI's strengths in drones, naturally aligned with action camera scenarios.

Initially, DJI removed the three-axis gimbal from its drones, added a camera, and created a handheld gimbal camera, the precursor to the later blockbuster Osmo Pocket. In 2019, DJI released its first action camera, Osmo Action. By 2025, DJI had launched its first panoramic and thumb cameras, completing its full imaging product lineup.

While DJI was dominating the drone sector, Liu Jingkang's Insta360 was just starting. Dubbed the "Red Boy" by Wang, Liu was already a well-known serial entrepreneur, having stood out in various entrepreneurial competitions and gained favor from investors like Zhou Hongyi and Kai-Fu Lee.

For a long time, Insta360 did not enter DJI's radar.

Insta360's first product was an enterprise-grade VR panoramic camera, which, like all VR products, remained niche. The following year, Insta360 launched the Nano, the world's first iPhone-compatible panoramic camera. Its standout feature was "stream and stitch," significantly reducing video processing time.

Insta360 truly gained prominence with the 2017 release of the Insta360 ONE, its first panoramic action camera, which introduced an innovative "shoot first, select scene later" approach, winning over users.

Insta360 faced the same issue as DJI. While maintaining a high market share in the panoramic camera sector it pioneered, the overall industry was worth only a few billion yuan. Whether for capital or growth needs, listed Insta360 had to explore new sectors.

In 2016, Insta360 released the Insta360 Nano panoramic camera. In 2018, it launched the Insta360 ONE X action camera. The following year, the thumb camera Insta360 GO was released. Insta360's product lineup now fully covered the handheld camera segment. Last year, Insta360 entered the drone, handheld gimbal, and wireless microphone markets, completing an ecosystem from imaging capture to sound recording.

The consumer product lines of the two companies now heavily overlap.

GoPro was no longer invincible, with its market share in action cameras declining yearly. The two Shenzhen-based companies, headquartered just 10 kilometers apart, finally clashed.

But this was an asymmetric competition. Compared to the arrogant GoPro, DJI had virtually no weaknesses. In July 2025, DJI released its first Osmo 360 panoramic camera, priced at 2,999 yuan. In just three months, DJI captured about 43% of the panoramic camera market, achieving parity with Insta360.

In contrast, Insta360's offensive against DJI seemed somewhat weak. The sales of its first drone remain undisclosed, with media reporting only 1,000-2,000 units sold in the first three days, while Insta360 claimed 30,000 units shipped in the first month. Even so, it could not shake DJI's dominance in drones.

An agency teardown report revealed that the comprehensive hardware cost of Insta360's A1 standard kit after taxes was approximately 5,512 yuan, roughly the same as its post-discount price. In other words, Insta360 was essentially selling at cost.

In contrast, in sectors like robotic vacuums, where DJI's capabilities were less synergistic, DJI's dominance was weaker. Its Roma robotic vacuum, launched after five years of development, failed to make waves in the market.

No wonder Liu Jingkang lamented, "Our greatest misfortune is having DJI in our sector, but our greatest fortune is also having DJI."

DJI sets technological and product benchmarks for the industry, expanding the market's imagination. However, taking a bite out of DJI's market share is harder than persuading Yu Hao to stop making short videos.

03

Early in 2026, DJI sued Insta360 in the Shenzhen Intermediate People's Court for patent infringement. For Shenzhen, a city that values both companies, this promised to be a thorny lawsuit. Prior to this, DJI had also pressured Insta360 through strict supply chain and dealer channel controls, prompting Liu Jingkang to publicly criticize DJI in the media.

Besides patent litigation and supply chain pressure, DJI has another potent weapon: price cuts. Thanks to its complete technological layout, DJI maintains high profit margins and can swiftly overwhelm new competitors with price advantages.

DJI had previously used this tactic to crush 3D Robotics, North America's largest consumer drone manufacturer.

Founded by Chris Anderson, former editor-in-chief of Wired, 3D Robotics was once valued at $360 million. However, its first drone, Solo, faced repeated delays. More critically, as a Silicon Valley-based software-centric company competing against a vertically integrated Chinese manufacturing powerhouse, it found itself at a disadvantage. Priced at over $1,700 with a gimbal and GoPro camera, Solo was undercut by DJI's Phantom 3 Professional, which dropped to $1,000 after Solo's release.

Combined with delivery delays and various after-sales issues, 3D Robotics, having released only one drone model, quickly laid off staff and exited the consumer drone market. Anderson later remarked, "I've never seen such price cuts in any market. Except for DJI, everyone lost."

When DJI entered the agricultural drone sector in 2016, it declared, "No profit for two years." The following year, when XAG, its competitor in agriculture, released a new drone model, DJI slashed its agricultural drone prices by 8,000 yuan. "In those years, whenever XAG released a new product, DJI initiated a major price cut."

When asked by a reporter why DJI maintained relatively low prices, Wang explained his business logic: "While others make components, we make complete products. We sell components at low prices and use mass production to exert maximum pressure on competitors. Without volume, competitors cannot compete with us."

This approach of not allowing competitors to make money continues to this day. Late last year, Insta360 made an aggressive move into DJI's core market by launching its first drone, the A1, priced at 6,799 yuan after national subsidies. In March of this year, DJI quickly responded by introducing its first panoramic drone, the Avata 360, with a standalone version priced at just 2,788 yuan and a complete set at 5,488 yuan. Such aggressive pricing forced Insta360 to follow suit with price reductions.

When Insta360's gimbal products were launched at 900 yuan, DJI promptly reduced the price of its similar products from over 900 yuan to over 700 yuan. In November last year, Insta360 released its latest action camera priced at 450 US dollars, and DJI subsequently lowered the price of its action camera to 300 US dollars within three months.

Faced with DJI's aggressive pricing strategy, Insta360 had to initiate significant price reductions within just a month: the Insta360 X4 model was directly reduced by 1,000 yuan, and the Insta360 X5 complete set was reduced by 500 yuan. Facing DJI, which is ten times its size, Insta360's profits have been severely impacted.

Insta360's 2025 financial report already shows obvious symptoms of increasing revenue but stagnant profits. DJI, on the other hand, is thriving thanks to its accumulated technological brand equity and strong supply chain control.

DJI's product logic and pricing philosophy involve capturing a higher market share to lower costs, while maintaining high profit margins and substantial R&D investment to widen the gap with competitors.

Not long ago, DJI released the Pocket 4. Although there were no significant differences in product form and innovation points compared to the previous generation, the price was lowered from the initial launch price of the previous generation despite increased storage, leading to enviable sales volumes. Facing a host of upcoming competitors, DJI still firmly holds the initiative in its own hands.

Ten years ago, Frank Wang told the media, 'If I were Steve Jobs, I would have launched a more affordable version of the iPhone earlier and not sat idly by while Android rose. I would rather forgo profits than monopolize the market.'

In reality, companies that can maintain a monopoly in the market never have low profits. In 2025, DJI achieved 80 billion yuan in revenue and over 20 billion yuan in net profit. Even Lei Jun would shed tears at this net profit margin.

04

If we say that DJI has few formidable competitors in the consumer drone market, the imaging sector is much more fiercely competitive.

However, DJI is very fortunate. Just as consumer drones face various flight restrictions and encounter growth ceilings, the emergence of the Pocket pocket camera has once again driven DJI's growth.

The Pocket product was initially not like (favored). Many believed that with the increasing imaging capabilities of smartphones and the decline of DSLR and compact cameras, there was no reason for people to buy another handheld camera. When Frank Wang initiated the first-generation product, he also believed it was just a '1 billion yuan-level small market.'

The sales of the first two generations of Pocket were not impressive, with each selling just over a million units. They were more like toys for tech enthusiasts and had not yet become a must-have for young women to showcase their beauty on short video platforms.

However, the Pocket3 broke the deadlock, with cumulative sales exceeding 10 million units, contributing 20 billion yuan in revenue to DJI, becoming its most profitable and highest revenue-generating product line.

In a China with such a developed manufacturing industry and supply chain, it is somewhat surprising that DJI has been able to enjoy such long-lasting dividends in the pocket camera market. To quote Zhao Ruilong from In the Name of the People, 'Jingzhou cannot allow such a Awesome (awesome) character to exist!'

The success of the Pocket, besides breakthroughs in its compact structure and three-axis gimbal, is also attributed to the rise of vlogs and short video platforms, which have created a growing demand for casual video shooting. In the past, DJI's products were mostly sold to male users, but Pocket3's female users account for half.

Manufacturers struggling in the red ocean of consumer electronics have discovered that the pocket camera market pioneered by DJI is surprisingly lucrative.

The hardware industry has always been one that can easily generate high revenue but is difficult to achieve high profits. When Xiaomi went public, Lei Jun publicly promised that Xiaomi's comprehensive net profit margin would not exceed 5%. However, smartphone manufacturers have surprise ly found that selling a few flagship phones with great effort is not as profitable as DJI selling a simple Pocket3.

Since last year, the Pocket market has become extremely crowded. Highly competitive smartphone manufacturers can no longer ignore the lucrative pocket camera market.

Vivo initiated a pocket camera project at the end of 2024, with a team size exceeding 200 people, and plans to launch its first product by the end of this year. OPPO's pocket camera project is led by Liu Zuohu personally and will also be launched this year. Xiaomi is also rumored to release a pocket camera product in the fourth quarter of this year, with its imaging team personally overseeing the project, internally codenamed 'Pocket Eye,' with a clear goal: to bring down DJI's prices.

Theoretically, smartphone manufacturers have a natural advantage in making pocket cameras. They possess strong engineering and supply chain management capabilities, with rich experience in structural design, heat dissipation, miniaturization integration, and large-scale production. Moreover, the domestic action camera industry chain is also very complete.

Imaging has been a core focus for major smartphone manufacturers in the past few years, with significant investment. Each imaging team has a size exceeding a thousand people, with deep accumulation in image stabilization, AI algorithms, and software-hardware collaboration. Smartphone manufacturers, known for their strong imaging capabilities, have no reason not to carve out a share of DJI's market.

Besides smartphone manufacturers, vertical players are also gearing up.

Hohem, a leading gimbal company, showcased its first Vlog camera, the Hohem Eyepic, at this year's CES. It combines a three-axis gimbal with a magnetic camera module into one, allowing the body and lens to be separated.

Insta360's pocket camera, the Luna, is also about to be launched, adopting the same strategy as DJI, with both a basic single-camera version and a flagship dual-camera version. In fact, five years ago, Insta360 spent tens of millions to develop a product competing with Pocket, featuring a modular design. However, due to poor heat dissipation and subpar user experience, it had to be scrapped. Now, Insta360 is re-entering this market. On one hand, DJI Pocket's sales are too tempting, and on the other hand, DJI has already penetrated deep into Insta360's core market, forcing Insta360 to launch a comprehensive offensive.

However, past competitions have shown that DJI is not an easy opponent to defeat.

DJI's continuous accumulation of engineering experience in gimbal miniaturization, torque control, and optical engineering over the past decade has given it a sufficiently strong technological moat. Moreover, smartphone imaging focuses more on photography, while pocket cameras have always focused on video shooting, with some differences in their technological paths. Additionally, smartphone imaging relies more on algorithmic image stabilization, while DJI Pocket achieves physical image stabilization through a three-axis mechanical gimbal.

More crucially, in this market guarded by DJI, most of Pocket's components are self-researched or customized by DJI, and the entire camera module is also encapsulation (assembled) and manufactured by DJI itself. This creates a significant barrier for newcomers.

A media outlet once quoted an industry insider as saying that to create a camera with an experience and performance close to that of the Pocket3, the cost of hardware stacking and overall product refinement alone might exceed the retail price of the Pocket3.

In the business world, every lucrative market has always attracted a large number of predators. This resembles a scene from a BBC documentary: a stranded whale becomes a feast for a mother polar bear and her cub during times of food scarcity, but as the smell of decay spreads, polar bears from dozens of kilometers away quickly arrive to collectively partake in the whale feast.

Having grown into a giant unicorn, as DJI extends its business tentacles into more and more fields, its advantage (dominant) areas will also face more predators. DJI can no longer quietly accumulate wealth as it did in the past.

When Liu Jingkang was asked how he would face DJI, which is ten times larger than his company, he said he was different from others—he was a patient competitor. The new batch of DJI challengers seem to realize that in the face of the mighty DJI, the only way to defeat it is to use DJI's own methods.