Lenovo is expected to soon complete its acquisition of Motorola from Google but its mobile device ambitions do not stop there. The company announced yesterday that it will create a new company focused on selling smart devices and services exclusively online. The new company will operate in China under its own name and brand when it launches in April 2015.
The objective of this move is to help Lenovo attack the fast growing consumer mobile device market in China, with a focus not only on devices, but also on software and application development and close customer engagement. Currently Lenovo has a leading smartphone business, which sells mainly through open market sales and carrier relationships. While Lenovo has and continues to strengthen its own company-branded online channels as part of its go-to-market strategy, the new company will exclusively focus on direct-to-consumer sales, marketing and product development using an internet-based business model.
The new company will be headed up by Chen Xudong who is currently a president at Lenovo. Two Lenovo vice presidents, Liu Jun and George He will become the company’s co-chairmen.
As CNET points out, it appears that Lenovo is hoping to replicate the succes that Xiaomi has had with this model. The announcement does not preclude Lenovo from continuing to offer mobile devices as well. It remains to be seen if and how the Motorola acquisition might fit into this new model.