China's computermakers tap vast rural market with simple tools and local officials' support.
Visitors to the annual agricultural fair here this week were treated to something more than the corn harvesters and feedstuff pulverizers that usually grace such events.
They got to gawk at an item that its makers hope will become the Chinese peasant's next must-have piece of agricultural machinery: a $199 computer.
Lenovo, the world's third-largest computermaker and China's best-known global brand, chose this northeastern town to launch its assault on the growth frontier for PC sales – villagers in developing countries – and start bridging the digital divide between urban and rural citizens.
To tempt farmers into high-tech territory, Lenovo executives explain, they have tried to make their machine easy to use, cheap, and robust. But its key feature, they say, is its software, dubbed "Road to Riches," that helps peasants search for agricultural information that will boost business.
Wang Shunxiang, a fungus grower and the first customer to buy the computer, thinks he can see the potential.
. "If this helps me know more about market prices and find more dealers to sell to … it won't take me more than a few days to make back the money I am spending," he predicts.
Lenovo's President for Greater China, Chen Shaopeng, sees profit in the "Tianfu" (Heavenly Prosperity) model too, as he eyes 250 million households in the Chinese hinterland. "The rural market in China is huge," he points out, "and computer penetration is practically zero. This is a totally new market to be explored."
That novelty brings challenges: Electricity supplies are not always reliable in the Chinese countryside, phone lines reach only 47 per cent of rural homes according to government statistics, and even $199 is beyond the means of millions of peasants.
Lenovo's new product will also be competing with another low priced PC just launched by another Chinese producer, Haier. "These are very much early days," cautions Wang Jiping, an analyst with the US research company IDC. "They are still at the investment and ground-laying stage."