Xiaomi and others have become unaffordable

Written by / Li Jinlin

Edited by / Li Ji

Typeset by / Annalee

If Xiaomi and Apple sold at the same price one day, which would you choose?

Since the first half of this year, domestic mobile phone manufacturers have revealed the cost increases with difficulty, and even prepared users in advance for the price increase of new models.

In the recent autumn season for new product launches, Xiaomi, vivo, OPPO, Honor, and OnePlus have all increased their prices to varying degrees as expected. Domestic mobile phone flagship models have collectively surpassed the 5,000 yuan mark. On the path of competing in high-end and AI, how far are they from Apple?

Some say, 'Qualcomm chips increase in price every year, from hundreds to thousands. What are manufacturers supposed to do?' Others say, 'Phones are updated every year, and while they claim to invest heavily in research and development, the actual price increase is more noticeable to ordinary users than the intangible AI features.'

After more than a decade of grinding, domestic mobile phones have finally seen an opportunity to overtake in the AI era. However, the current wave of price increases seems to be increasing the value of the saying, 'Couldn't afford domestic phones before, can't afford them now.'

'Couldn't afford domestic phones before, can't afford them now'

Xiaomi 15 Pro, starting at 5,299 yuan;

OPPO Find X8 Pro, starting at 5,299 yuan;

vivo X200 Pro, starting at 5,299 yuan;

Honor Magic7 Pro, starting at 5,699 yuan.

The new batch of domestic mobile phone brand flagship models, released concurrently in autumn, have tacitly increased their prices and surpassed the 5,000 yuan mark. The era of low-priced domestic mobile phones may be gone forever.

Lei Jun's previous response to the pricing of Xiaomi 15

However, is this the ceiling for domestic mobile phone pricing? Definitely not, as can be seen from previous explanations by manufacturers regarding price increases.

Starting with the Xiaomi 14 series, Lei Jun revealed to 'Mi Fans' that this would be the last time pricing would be set at 3,999 yuan. 'This year, with the upgrade to 3nm technology and significant cost increases in supply chain RAM and ROM, along with our significant investments in research and development, Xiaomi 15 indeed needs a price increase.'

Huang Tao, vice president of vivo products, also said, 'Currently, there are many price increases in mobile phone components, including SoCs, screens, memory, etc. The current pricing of new models is already the limit that vivo can achieve.'

Consumers do not sympathize with the reasons given by capital. Compared to the seemingly distant reason of mobile phone component price increases, the final pricing of mobile phones is more perceptible.

For most consumers who only care about brand, system, and price when choosing a mobile phone, brands that pass on cost pressures to consumers will receive the result of voting with their feet.

Netizens' attitudes towards domestic mobile phone price increases

'Current mobile phones are too expensive. With a myriad of complex functions, prices have gradually increased, but in reality, the practicality of most of these functions is not high. Many people may not even use them by the time they replace their phones.' Qin usually directly chooses the latest flagship model of domestic brands when selecting a mobile phone. In his view, the appeal of past domestic mobile phones lay in their 'affordability and generosity.'

However, in the past two years, the cost-effectiveness of domestic mobile phone brands has gradually weakened. 'Advertisements are becoming more exquisite, with influential endorsers and an increasing number of flashy features. Not many of these features genuinely enhance the mobile phone experience, but they will certainly become reasons for price increases,' Qin told Znker.

If criticizing the price increase of domestic mobile phone brand flagship models seems harsh, let's consider budget models.

'I bought an OPPO R9 in 2016 with 4+64GB for 2,500 yuan. In 2019, I bought a OnePlus 7 Pro with 8+256GB for 4,499 yuan. This year, I plan to buy a OnePlus 13 with 12+512GB for 4,899 yuan. From my personal experience, the investment in memory for each phone replacement has been increasing, but it's a necessary configuration because low-memory domestic mobile phones will soon become sluggish. Domestic mobile phones priced around 2,000 to 3,000 yuan have increasingly lower cost-effectiveness,' said 'Li Zi,' who was selecting a phone for her mother, lamenting the difficulty in finding a cost-effective phone today.

After visiting several offline stores for domestic mobile phones, 'Li Zi' summarized, 'There are cheap phones, but when you look at the specifications, you can barely bring yourself to buy them. After all, if they break or become sluggish after two years, replacing them will be another expense. However, those with decent specifications are mid-to-high-end models, and there's no price advantage.'

'Li Zi' also stated that even the elderly now have higher demands for mobile phones beyond basic functions. Her mother, who takes photography classes at a senior university, wants to replace her phone with one that has better photography capabilities. Domestic mobile phone brands often only feature powerful imaging functions in their flagship models, but these models have redundant features for the elderly like her mother. It's almost as if they are paying double for one feature. 'I suddenly understand why domestic flagship models all love to compete in imaging,' she said.

The price increase of domestic mobile phones is like 'boiling a frog in warm water.' Only when you look back do you realize that domestic mobile phones are no longer what they used to be.

Are AI features really that valuable?

Who remembers August 16, 2011, when Lei Jun, wearing a black T-shirt and dark blue jeans, stood at the center stage of Beijing's 798 Art Center and introduced the Xiaomi 1 for 1,999 yuan?

Since then, Xiaomi has become an overnight sensation, and getting one was considered blessed by luck. You can still glimpse the popularity of Xiaomi's low-priced phones from old forum posts.

'Leaving aside unreliable network factors, having a fast enough reaction speed during the noon launch is also one of the factors determining successful purchase.' Experts in the Xiaomi community would provide tips and strategies for snatching up phones before they went on sale.

Xiaomi once stood out with its low prices

Back then, getting a Xiaomi was like hitting the jackpot.

Also in 2011, Yu Chengdong officially took over Huawei's mobile phone business, initiating sweeping reforms, abandoning the ODM business of making white-label phones for operators, and instead creating Huawei's independent brand.

In 2011, OPPO officially launched its first Android smartphone, the OPPO X903, officially entering the smartphone field.

In 2011, after struggling to complete the task of clearing inventory, vivo finally launched its first Android phone, the vivo V1.

That year, domestic mobile phones opened up their 'Ren and Du' meridians and stood on the same track as Jobs' last phone.

Thirteen years have passed, and the first year of AI mobile phones has quietly arrived. Mainstream manufacturers have collectively followed the strategy of 'All in AI.' The past competition in imaging has receded, and AI has become the core strategy for conquering the market and the fundamental reason for price increases.

Domestic mobile phone manufacturers' R&D investments in the AI field will continue to increase, and current pricing has not yet reached the ceiling. It is understood that Xiaomi's estimated R&D investment this year will exceed 24 billion yuan and is planned to increase this figure to 30 billion yuan by 2025. These investments will primarily be used for continuous R&D and innovation in underlying technologies such as AI, operating systems (OS), and chips.

OPPO, vivo, and Honor have also invested over 10 billion yuan in AI in recent years. Major manufacturers are rushing to capture the mobile AI era's entrance.

However, to control costs and balance price and configuration at this stage, the collective launch of new products this autumn has already shown a trend: hardware improvements over last year are minimal, and some products have even regressed. Meanwhile, AI edge models, or agents, are beginning to bring more practical applications, allowing users to feel where their money is going after spending it.

Although many users still do not feel the charm of AI mobile phones or see the impact of supply chain price increases behind them, the trend of domestic mobile phone price increases is unstoppable. Whether future cost changes and overall market supply will lead to dynamic fluctuations in mobile phone pricing remains a long-term proposition.

However, some consumers also bluntly state, 'Whether it's AI or camera pixels, the direction of competition is unnecessary. Who can reduce prices is truly in line with the needs of most people.' There may be disagreements between manufacturers and consumers on this point.

Admittedly, all education takes time and has a cost, but will price-increased domestic mobile phones still be your choice?