Lenovo’s “For Those Who Do” marketing slogan certainly is right on target when it comes to devices to “do” just about anything linked to the Internet.
And the virus sweeping the global information technology business – “IoT” or Internet of Things – is certainly driving up the fever within the world’s No. 1 PC manufacturer. (Lenovo also is now No. 3 in tablet sales after a 65 percent surge in the second quarter, says research firm IDC.
Lenovo announced a wearable “smart glasses” deal on Thursday and has created a “New Business Development” team focused on IoT opportunities.
But is the company overreaching?
While Chairman and CEO Yang Yuanqing insists that the computer business remains the company’s “bread and butter,” he also is driving Lenovo to expand its reach into smart Internet-connected devices, more tablets, smartphones. Then there are the big deals: Pending acquisitions of Google Motorola Mobility and IBM’s x86 server business.
Lenovo’s thirst for even more growth is apparent in the IoT announcements – and the firm, which operates its executive headquarters in Morrisville but still maintains most of its operations in China is targeting its home base for what No. 1 IoT evangelist John Chambers of Cisco has touted as a multi-trillion-dollar business opportunity.
China media reports that Lenovo has set up a 13-member New Business Development team that will focus on IoT. It is based in Beijing and will operate as a “startup incubator.”
Lenovo also will invest in IoT companies or set up joint ventures, according to senior vice president Chen Xudong.
“We cannot make all the products even though we know some of the devices are clearly profitable,” Chen told the People’s Daily. (However, Lenovo has filed a patent for its own smart glasses.)
And the group will operate with what he calls “an Internet philosophy.” In his view, Chen said: “There’s a clear difference between it and the company’s traditional businesses such as PC and server sales.”
The group was created six months ago, according to one executive, but made its first big headlines with the smart glasses deal involving New York-based Vuzix.
Too Much IoT?
Not everyone is impressed with Lenovo’s strategy.
“Lenovo’s foray into smart air purifiers, glasses and routers will distract it from many more important tasks at hand, and are likely to end in failures,” says a headline on a column written by Hong Kong journalist Doug Young.
In his Corporate China commentary for the South China Morning Post, Young wonders if Lenovo’s fever is too risky?
“The company’s inability to be satisfied with the status quo has helped propel it to the world’s top PC maker through a series of acquisitions over the last few years, making it one of China’s best known global brands,” he says. “But that same inability to focus also means Lenovo is constantly venturing into new areas, both for products and geographies. Some of those look good, but many often lead to headaches and disappointment.”
The full column can be read online.
Read more about Lenovo’s strategy at the People’s Daily.
[LENOVO ARCHIVE: Check out nearly a decade of of Lenovo stories as reported in WRAL TechWire.]