Chapter 1044: 1044
Chapter 1044 – Lenovo wants to be listed
Other than PCs, Lenovo still has an essential business division, which is Lenovo Kingsoft Company’s software development .
The company is developing its own operating system and other programs like office software .
“The progress for the operating software is still ongoing, but the features you want for the operating system will make the files too big . It will be over 10G, and it is much higher than Win98 . ”
“It doesn’t matter . Just think of the PCs development speed these few years . Two years ago, 40G hard disk is the mainstream, and now, it is 80G, and the high-end PCs are all fitted with 160G . When our operating system is developed, the commonly used hard disk will be 160G or even 320G . So, it doesn’t matter for the file size to be slightly bigger, or it requires higher RAM and graphics . Most importantly, it must be easy to use . ”
These next few years, hard disk technologies will be advancing fast, and even if the operating system has a high requirement for the PC specs, it does not matter . They can even market it as a high-end product in the future .
“The progress of those simplified operating systems is even slower, and we estimate it will take another five years before we can succeed . ”
Five years to develop the Android system is sufficient . The concept for smartphone only comes up during that period, and it’s development have not started . The first iPhone will hit the market after 2007, and the smartphone’s development will increase rapidly from then . Smartphones will become the mainstream phones in 2010 and brought along the rise of phone Apps .
“What about the rest of the software? What is the progress of our WPS office software?”
“We estimate we can release a new version with your requirements next year . Most of the functions you requested had been completed, and some of the functions are more advanced than Microsoft . Also, all the PC manufacturers in China had started to pre-install this software on their PCs last year .
Pre-installation is equivalent to packaging the software together with the PCs . This is just like the Windows operating system . After Win98 was launched, Microsoft and Lenovo had signed an agreement which includes only the operating software, and not Microsoft Office .
Microsoft thought this will increase their profits as most PC users are used to their Office software . Even if they start charging in the future, the users will be willing to pay for them . From this year onwards, Microsoft will no longer provide free upgrades to the older versions .
But Microsoft did not expect their decision will give Lenovo Kingsoft this opportunity to pre-install their WPS office software on the PCs, letting the users get used to this new office software .
The current version is not as good as Microsoft office, but it is ‘free’ for the users . What the users did not know is that the cost of this software had been added to the PC when they purchase them .
From next year onwards, after the new and better office software is launch, Lenovo will have to charge the users . But the selling price of this software is much lower than Microsoft Office .
Despite the low prices for their Office software, Lenovo Kingsoft will still get high profits .
“Remember, the most important thing is compatibility! Regardless of the operating systems, or application software, we must be compatible with Microsoft products . If Microsoft refuses to allow this, then they will lose the whole Chinese and East Europe markets!”
“Manager Feng, you are a shareholder and Director of Microsoft . This…”
Feng Yu waved his hand . “I will dump all my Microsoft shares at the end of this year and leave Microsoft . I believe our Lenovo group have a better prospect than Microsoft, because we are doing both hardware and software, and Microsoft only has the software . ”
In Feng Yu’s previous life, Microsoft market value and share prices will reach its peak at the end of the year . Feng Yu had been watching the stock market closely, and the market is showing signs of dot . com bubble bursting .
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The share prices of many tech companies, which do not have any good products, had been rising several folds . How can these companies have such a high rate of returns?
These companies had used high-tech concepts to package themselves, and speculators pushed their share prices up . Once there are changes to the policies, or a big player pulls out, the share value will plunge .
Once the share prices plummet, it will create a tsunami, and the total industry share prices will be affected .
You might ask, what if there are no big players that dump their tech shares?
Feng Yu is a big player!
Feng Yu’s Microsoft shares are worth over 10 billion USD . If he dumps all his shares at once, other investors will think Feng Yu had lost confidence with Microsoft . Don’t forget, Feng Yu is also a Director at Microsoft .
This is a sign that Microsoft is in trouble .
Once Microsoft share prices plunge, it will trigger a devastating effect on all related stocks, and all technology stocks will plummet, bursting the dot . com bubble .
In Feng Yu’s previous life, the share prices of China’s internet companies, like Sina, Sohu, NetEase, etc . shot up after they got listed . For a short time, these people become China’s top tycoons .
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But very soon, these companies’ value shrunk after the dot . com bubble burst . But most Chinese investors did not suffer losses, and the ones that suffered losses are the ones who speculated in the US stock exchange .
These three companies were listed in the US and used the funds raised on their development in China . Even if their share prices dropped lower than their public offering price, the companies are not affected .
Their shares, which is supposed to be worth 5 USD, was sold at 8 USD . Now, the share prices fell to 4 USD, and the companies can buy back all their shares .
This is like borrowing money with zero-interest for the company’s development, and the companies had still make some profits from it . The overseas investors are the ones who lose money and not them .
That’s why Feng Yu had told Sina, Sohu and NetEase to get listed on NASDAQ before the end of the year . They must take advantage of the rise of tech stocks to raise funds .
After the bubble burst, they will buy back their issued shares and get delisted . The companies will not suffer any losses, and the only problem they will face is, it will be hard for them to get listed again . The checks will be more stringent, and the public will not respond well to their public offering .
“Oh, Manager Feng, Lenovo is planning to get listed . Do you think we can get listed in the US?” Liu Chuanzhi asked .
“What’s wrong? Is the company running low on funds? Why do you want to be listed?” Lenovo had planned to be listed in Hong Kong last year but was stopped by Feng Yu .
“It’s not that . We are thinking of entering the US, and European markets and people know that we are a large company! If our company’s value is high, the consumers will have confidence in our brand and products . ”
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Feng Yu heard it and felt he should not stop Lenovo from getting listed .
“Then you should get listed in the US NASDAQ or NYSE . With Lenovo dominating Asia’s PC market, the share prices should shoot up . I can introduce a few investment banks to you . ”
Lenovo will also make a huge profit from this upcoming dot . com bubble burst, and Feng Yu has no reason to stop them .
After getting listed, Lenovo will have more funds for its expansion into the overseas market . Those that look down on China’s PC and IT industry in the past will be regretting now!
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