Space not the final frontier for Olympic "magic pen" firm (Feature)

By Bill Smith Sep 11, 2008, 6:08 GMT

Beijing - A place for its technology on China's next manned space mission, Shenzhou VII, symbolizes the ascendancy of the Huaqi electronics group from its origins as a 'briefcase company' to the owner one of the country's top digital brands.

But the Beijing-based firm is also focussed on more important terrestrial frontiers for its Aigo brand of high-technology consumer products.

Company president Feng Jun said he started Huaqi in 1993 with just 200 yuan (29 dollars) as the electronics boom was getting under way in Beijing's Zhongguancun district, proudly dubbed 'China's Silicon Valley' by some of its founders.

Feng, 39, is now one of China's most famous younger entrepreneurs.

'The most important thing is to make the consumer happy,' Feng told Deutsche Presse-Agentur dpa at his office near Zhongguancun. 'The second is high-quality, trouble-free good service.'

Under the slogan 'freedom in technology, freedom in life,' Aigo has diversified into a full range of digital products and raised its annual revenue more than 300 million dollars, according to estimates by Chinese media.

It sells televisions, cameras, solar chargers, photograph screens, 'micro i-stick' memory devices, and advanced MP3, MP4 and MP5 music players, some of them housed in wristwatches.

Yet friends suggested Feng was 'crazy' when he decided to enter the oversupplied Chinese market for mobile telephones from this month, with plans to incorporate technology from Aigo's mobile internet devices.

The company is known as Aiguozhe (Patriot) in China and employs some 1,800 people, including about 500 at its research centres in Beijing, Shanghai and the southern city of Shenzhen.

It concentrates on research and development, and finds local manufacturers for its new products.

Aigo launched an international sales drive in 2003 in Singapore and other South-East Asian nations. It began opening offices in Europe in 2006 and has also started selling in North America.

Last year, it began sponsorship of the McLaren Formula 1 racing team to increase global recognition of its brand under its 'second phase of the internationalization process.'

Aigo signed another contract last year with Chinese international footballer Shao Jiayi, who plays for Energie Cottbus in Germany, to market a range of digital cameras in its first foray into the German market.

Overseas expansion is a 'must' for the next few years, Feng said, adding that the main responsibility of its US and European offices is to look for potential partners.

To bridge the language barrier, Feng has studied English and now speaks fluently.

He has tried to use the Olympics as a springboard for Aigo's global marketing plans and to overcome another barrier for Chinese goods with Western consumers.

'Before, Chinese brands were all low-end image,' Feng said. 'They can accept 'made in China' brands but they cannot accept Chinese brands,' he said of Western consumers.

Aigo showcased its products in the Olympic media centres, especially its innovative 'magic pen,' a digital recorder which uses infrared technology to read cues linked to audio files.

Feng hopes to see Aigo pens used by tourists in cities such as Barcelona, with other possible applications in manuals for high-technology products, language training and children's toys.

The pens will be used in the Olympic Museum's travelling exhibition and join its permanent collection in Lausanne, Switzerland.

Feng believes the Olympics has already helped to raise the profile of China and Chinese businesses.

'I think this opening ceremony has opened the gates of the future,' he said.

'And the Olympics is a patriotic games, so I think this is good for us,' Feng said.

Spurred on by his improving English, Feng now mixes with movers and shakers from China and abroad.

He arrived late for an interview after an extended lunch with former International Olympic Committee president Juan Antonio Samaranch, who acted as a consultant for Aigo's language training programme for the 100,000 Olympic and Paralympic volunteers.

From the inner sanctum of his office, Feng brought out photographs of him with top Chinese officials and inside the returned space capsule of Shenzhou VI, China's second manned mission, for which Aigo provided recording equipment and memory devices.

Aigo has 'many contracts' for this month's Shenzhou VII mission, Feng said, adding that he was not allowed to give details of the contracts.

Shenzhou V, China's first manned space flight, used Japanese digital technology and Feng said he initially worried that Aigo's quality might not have been high enough.

Now he sees the prolonged use of Aigo technology in the space programme mainly as a testimony to its reliability.

'I hope that in the future we can be another Sony,' Feng said. 'But for that dream we must work very hard.'