Prices in overseas markets are higher than in the domestic market, and given the rapid pace of mobile phone upgrades in China, profits in overseas markets are quite substantial.
Taking rice as an example, in 2020, overseas revenue from rice exceeded domestic revenue for the first time.
Cheng Gang, formerly the investment director of Shunwei Capital, had a thorough understanding of the profit sources in the mobile phone industry.
Shunwei Capital invested in many mobile phone supply chain companies after Lei Jun founded Dami.
Cheng Gang countered, "President Chen, when your company purchased patent licenses from Qualcomm, did Qualcomm charge tiered fees?"
Qualcomm typically sells chips and then charges for a package of other patents.
"Science and Technology Innovation's brain-computer interface patent is currently the only commercially viable brain-computer interface patent on the market, so I think it is entirely reasonable for it to enjoy an appropriate premium."
"Relying on our Chinese-language brain-computer interface technology for mobile phones, OPPO has made a lot of profits in Greater China."
Generally speaking, less than 20% of high-end Bluetooth headsets launched by mobile phone manufacturers are sold as part of a phone purchase.
After the launch of brain-computer interface phones, almost 100% of users also bought brain-computer interface headphones.
Almost all major mobile phone manufacturers operate this way. They also cleverly configure their devices so that only their own brain-computer interface can connect to the phone and can only be paired with their own earphones.
If users use other brain-computer interface devices, mobile phone manufacturers may claim they won't restrict them, but in reality, it will make your operation lag.
Rice has been making a lot of noise in the media to establish itself in the high-end market, but OV, which has been quietly working, has taken over a significant portion of the high-end market that it had previously withdrawn from.
Instead, they keep emphasizing that their rice is only for the high-end market, and they repeatedly tell users how cost-effective and technologically advanced it is, which is why it's so expensive.
However, the target consumers of high-end mobile phones don't actually care about cost-effectiveness. This is a very contradictory point for Da Mi.
Regarding the second phase of brain-computer interface patent licensing, major mobile phone manufacturers are privately coordinating to try to advance and retreat together, attempting to delay and avoid excessive price increases this time.
"If we agree to Kechuang Bio's demands this time, the price will be raised to eight hundred next time, and to one thousand the time after that!"
"Knowing that Qualcomm's 5G patent fees aren't even this outrageous! Are we really going to accept such high patent licensing fees?"
Qualcomm's 5G patent licensing fee is 65% of the selling price of each mobile phone plus 5%.
"We must remain consistent."
Everyone privately said they wanted to resist the monopoly of Kechuang Bio, but the first company to sign a patent licensing agreement was Samsung.
In order to seize the high-end market in Europe and the United States before Apple, Samsung signed a patent licensing agreement for 500 RMB.
Before news of Samsung signing first could even spread, Xiaomi became the second company to sign.
When the news of the signing of the agreement was released, the alliance to resist the monopoly of science and technology innovation and biotechnology ended before it was even established.
After the disclosure of the latest brain-computer interface patent licensing agreement of Kechuang Biotechnology, the outside world has witnessed the exorbitant profits of monopoly.
The price was increased by 150% in one go, with no room for negotiation.
This is an excellent popular science lesson on the idea that science and technology are the primary productive forces, making China realize why we need to move up the value chain.
This news made everyone realize just how valuable monopolized technology is, and it quickly went viral.
Pharmaceutical stocks have been under pressure for 2022, suffering a double blow to valuations from both news and capital flows. Previously core sectors no longer seem so core, and pharmaceutical companies that appeared to have high technological content don't seem to have the technological moat that everyone imagined.
As a company in the same pharmaceutical sector, Kechuang Bio is also questioned by institutions and retail investors, who question why it can enjoy such a high valuation.
A prominent figure on Xueqiu (a Chinese investment platform) published a lengthy article discussing this issue.
"With the improvement of the news, the Science and Technology Innovation Board Biotechnology Co., Ltd., which had fallen sharply for several consecutive days, finally turned red and today even returned to the 2,000 yuan mark with a long positive line with volume.
It is rumored that the patent licensing price for the English-language brain-computer interface of Kechuang Biotechnology is 500 yuan, but the news has not yet been confirmed and Kechuang Biotechnology has not issued an announcement.
However, judging from the trading volume, it should be true; retail investors cannot support such a large volume based on the unit price of Kechuang Bio.
Today I want to discuss whether the trillion-RMB valuation of science and technology innovation companies is truly justified. CATL reached its highest valuation last December, with a market capitalization of 1.6 trillion RMB.
Even after the recent pullback, its valuation is still 1.2 trillion yuan. In contrast, CATL's net profit in 2020 was only 5 billion yuan, and Kechuang Bio's net profit for the entire year of 2021 was around 10 billion yuan.
People say that CATL has high expectations and high growth, and that the penetration rate of new energy vehicles will further increase in the future, which is why CATL can enjoy a high valuation.
But if we look at it from another perspective, isn't Kechuang Bio a high-growth company? Ignoring its innovative drug pipeline, just in the field of brain-computer interfaces, Kechuang Bio's net profit growth is expected to exceed 100% in the past two years.
The market originally expected that the brain-computer interface research and development for English-speaking systems would be completed this year, but Kechuang Bio completed its research and development target, which should have been completed throughout the year, in January.
In other words, Kechuang Bio's profits in this area can be released in advance, just as major mobile phone manufacturers have not yet started their high-end mobile phone production capacity this year, making the profits in this area very promising.
As a minority shareholder of Kechuang Biotechnology, I have held the company since its listing and have even increased my holdings in the last two days.
I have higher expectations for it than just brain-computer interface with mobile phones. My hope for Kechuang Bio is that it can truly break down the boundaries between cyberspace and physical space through brain-computer interface and work with other Chinese companies to bring the metaverse to life.
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