Dell Partners with Baidu to Develop Smartphones & Tablets for Chinese Market
In an attempt to revive its Streak series of smartphones and tablets, Dell (NASDAQ:DELL) is now partnering with China’s search engine Baidu (NASDAQ:BIDU), which has nearly 80 percent share of the country’s search market to target the Chinese market. Right now the Chinese smartphone market is dominated by Apple (NASDAQ:AAPL) and Lenovo devices. [1]
We currently estimate that smartphones and tablets together make up 8% of our $20.75 Trefis price estimate for Dell, which is about 45% above the market price.
After Failing (miserably) in the U.S. and Europe, Dell Eyes China
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Dell, much like its arch rival HP (NYSE:HPQ), has not been able to capitalize on the booming smartphone and tablet market in the US and Europe. The company’s Streak 5 tablet, a five-inch Android-based tablet, was discontinued in the United States last month.
Dell has now turned its focus to China identifying the market’s huge potential. China is one of the fastest growing markets for tablets and is home to more than 900 million mobile phone subscribers. Earlier this year, Dell announced that it will launch its new 10-inch Android tablet in China, passing up on a U.S. and European launch. ((UPDATE 4-Dell, Baidu team up for tablets, mobiles, reuters))
Baidu Announces Mobile OS – Baidu Yi
The Baidu partnership could come in handy for Dell as the Chinese search giant itself is making a push into the mobile search market. Last week Baidu introduced its upcoming mobile operating system, the Baidu Yi – an Android based OS, as a growing number of its users now access the Internet from smartphones and tablet computers. [2]
Dell’s partnership with Baidu, which will involve Baidu’s new mobile platform, could provide the much needed momentum that Dell has been looking for. Dell smartphones/tablets running Baidu Yi OS could hit the market as soon as November though Dell has not provide any official date for such a launch.
While it remains to be seen whether the move will have any significant impact on Dell’s smartphone/tablet sales or not, the company sure is not exiting the smartphone/tablet market anytime soon as many have been expecting.
See our full analysis of Dell.
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