Chapter 473: The Thousand-Yuan Pager Revolution

In late autumn of 1992 in Shenzhen, the rain fell incessantly.

Just as Wanxiang DVD was selling wildly in the market.

Xu Jiaming stood before the floor-to-ceiling window of the Wanxiang paging station's main control room, staring at the street scene outside, blurred by the rain.

His white shirt's collar was unbuttoned at two buttons, the cuffs rolled up to his elbows, revealing the Shanghai Watch he had worn for years.

Behind him, twenty paging servers emitted a low, continuous hum, like a herd of exhausted old oxen struggling to pull a plow through mud.

"Chief Xu, another one has crashed."

The technician Xiao Liu's voice trembled with a sob. This was already the third server to crash this morning, and the cause was the same each time: the central processor overheated, triggering a protective shutdown.

Xu Jiaming didn't turn around, but watched the sweating young man through the glass's reflection.

"Switch to the backup unit and reboot," his voice was eerily calm, "Notify the maintenance team; it must be fixed before noon."

"But there are only two backup units left..."

"Then let the crashed one stay down a bit longer."

Xu Jiaming finally turned around; his face was expressionless, but the bloodshot eyes revealed three consecutive sleepless nights. He walked to the faulty server, crouched, and reached out to touch its case—it was hot enough to fry an egg.

This was the core equipment of the second-generation Wanxiang paging system, which had only gone fully online in October of the previous year. A grand launch event proclaimed, "Fully domestically produced, performance surpasses imported products by twenty percent."

Now it appears that the twenty percent performance boost was bought with a fifty percent failure rate.

Paging services had once been Wanxiang Group's cash cow.

The second-generation pager, launched in 1990, seized forty percent of the South China market from Motorola thanks to its "Chinese display" and "domestic chip" selling points.

At its peak, dealers queued for a kilometer at the factory gate, and scalpers hiked the retail price to 3,500 while demand still outstripped supply.

But that was only two years ago.

Two years in the electronics industry is enough to complete a full technological iteration.

"Chief Xu, here are last month's sales figures."

The secretary handed over a report. Xu Jiaming took it, glanced at it, and closed his eyes—month-on-month down eighteen percent, year-on-year plummeting thirty-seven percent. Even more glaring was the fine print below: Motorola's new digital pager saw a forty-two percent sales increase this month.

"Reason?" he asked, his eyes still closed.

"Motorola cut the price to 1,300," the secretary whispered, "and moreover... they launched a 'Secretary Desk' service, allowing users to leave messages, turning the pager into two-way communication."

One-way versus two-way.

It's a dimensionality reduction strike.

Xu Jiaming opened his eyes and walked to the office whiteboard. It was filled densely with numbers and arrows, a cost-structure analysis of the second-generation pager.

Chip cost: 320 yuan.

LCD screen: 180 yuan.

Housing mold: 60 yuan.

RF module: 240 yuan.

Assembly, testing, packaging: 100 yuan.

Total cost: 900 yuan.

Factory price: 1,500 yuan.

The gross margin looked attractive, forty percent.

But if Motorola sold at 1,300, the retail price would be forced below 1,500. Distributors need profit, factories need to survive, so the price can only be cut—to 1,200, even 1,100.

That margin would evaporate instantly.

"What does the boss say?" Xu Jiaming asked.

The secretary hesitated: "General Manager Li returned from Hong Kong yesterday and held a closed-door meeting. The minutes... are here."

Xu Jiaming took the two-page minutes.

The first page was market analysis: pager market saturation had reached thirty-seven percent, growth slowing; the big phones began price cuts, possibly falling below ten thousand yuan next year; Motorola, NEC, Panasonic were all developing next-generation products.

The second page contained only one line, in Li Ping'an's own handwriting:

"In times of peace, think of danger. Sell one generation, research the next."

Date signed: March 15, 1991.

Xu Jiaming's hand trembled slightly.

One and a half years ago. At that time the second-generation pager had just entered mass production, orders flooded in, and the factory's three-shift system couldn't keep up. Everyone was celebrating, calculating how much bonus could be paid at year's end.

Only Li Ping'an was already thinking about the next generation.

"Third generation... any progress?" he asked, his voice a bit hoarse.

The secretary pointed to the ceiling: "On the seventh floor, over General Manager Zhang's area."

The seventh-floor R&D center was a world apart from the clamor below.

It was so quiet you could hear the hum of the fluorescent ballast. The labs along the corridor had their doors shut, and only the frosted glass window of the innermost room emitted a faint blue glow.

Xu Jiaming pushed the door open and entered.

Inside the lab, Zhang Wei was leaning over a microscope, with dozens of disassembled pagers scattered nearby—Motorola's, NEC's, and Wanxiang's own. The walls were plastered with circuit diagrams, red annotations dense like battlefield deployment maps.

"Old Zhang," Xu Jiaming called softly.

Zhang Wei lifted his head, nudging the heavy black-rimmed glasses on his nose. His hair was messier, the cuffs of his white coat stained with rosin and solder, but his eyes held a spark Xu Jiaming hadn't seen in a long time—that of a hunter spotting prey.

"You came at the right time," Zhang Wei gestured, "Take a look at this."

He handed over a palm-sized black plastic case. Its appearance was plain, bearing no logo, and it weighed at least a third less than the second generation.

Xu Jiaming pressed the power button.

The screen lit up, not the usual green backlight but a soft pale blue. Instead of simple numbers or Chinese characters, it displayed a clean interface: time, battery level, signal strength, and four icons—messages, contacts, settings, services.

"What is this..."

"It's a third-generation prototype, code-named 'Wanxiang No. 3'," Zhang Wei's voice trembled with excitement, "Fully self-designed, from chip to software, all ours."

He took the prototype and began the demonstration: "Standby time, theoretical value 200 hours, actual test 180 hours, three times that of the second generation. Reception sensitivity improved by 40 percent, signals can be received even in basements and elevators."

Xu Jiaming's heartbeat began to quicken.

"What about the cost?" he asked, posing the most critical question.

Zhang Wei smiled, took out a cost calculation sheet from the drawer.

Chip Core: 180 yuan (in-house, 28-nanometer process)

LCD screen: 100 yuan (cooperated with Changchun Optics Factory, domestically produced)

RF module: 150 yuan (in-house, higher integration)

Housing and structural parts: 40 yuan

Battery: 30 yuan

Other: 50 yuan

Total cost: 550 yuan.

Xu Jiaming's hand trembled even more.

550 yuan.

This means the factory price can be set at 800 yuan, the retail price pressed to 999 yuan, while still maintaining a 30 percent gross margin.

And its performance comprehensively surpasses the second generation.

"Why…… wasn't it brought out earlier?" Xu Jiaming's voice trembled slightly.

Zhang Wei's smile faded: "Because it's still not good enough."

He walked to the whiteboard, drew two axes: "The horizontal axis is time, the vertical axis is performance. The second generation is here," he pointed to the lower left corner, "the third generation is here," he pointed to the middle, "but Motorola's new product slated for release next year is expected to be here."

His hand pointed to the upper right corner.

"If we release the third generation now, we can win the price war but not the technology war."

Zhang Wei turned, looked at Xu Jiaming, and said: "What we need is not a temporary victory, but a product architecture that can sustain for five years."

Xu Jiaming fell silent.

He looked at the plain prototype on the table and suddenly understood the weight of Li Ping'an's saying "be prepared for danger in times of safety." This is not idle worry; it is, while everyone else is focused on the ground, already having lifted his gaze to see the road three years ahead.

"How much longer is needed?" he asked.

"Two months." Zhang Wei said, "Mainly software optimization. We are currently using our own real-time operating system, stability is fine, but power consumption can still be reduced by another ten percent."

"I'll give you one month." Xu Jiaming said, "After one month, I want to see a version ready for mass production."

Zhang Wei frowned: "Too tight, the test cycle isn't enough……"

"The servers downstairs crash every day." Xu Jiaming interrupted him, "The dealers' return slips have piled up half a meter high. We have no time."

The two locked eyes.

In the lab, only the faint sound of instruments operating could be heard.

"Good." Zhang Wei finally nodded, "One month. But you need to assign me the best software engineers, and also…… persuade General Manager Li to approve the tooling."

Tooling means at least 2 million yuan of upfront investment.

If the product fails, that two million will be wasted.

Li Ping'an's office is on the top floor.

When Xu Jiaming knocked and entered, Li Ping'an was on the phone. He gestured for Xu Jiaming to sit, then continued speaking into the microphone: "……Yes, the price can be negotiated, but the delivery schedule cannot be delayed. Three months, I want to see the first batch loaded onto the ship."

After hanging up, he looked at Xu Jiaming: "Has the pager system crashed again?"

"It's fixed." Xu Jiaming said, "But this is treating the symptom, not the root cause. The architecture of the second-generation system has flaws, and its heat dissipation design is inherently inadequate."

Li Ping'an nodded, took out a document from the drawer—last month's financial report. He turned to the pager business page and circled several numbers with a red pen: revenue down 37 percent, gross margin fell below 15 percent, inventory turnover days extended to sixty-two days.

"Do you know what's most frightening?" he asked, his tone calm.

Xu Jiaming shook his head.

"It's not just the numbers dropping." Li Ping'an said, "They have dropped, but the people below are still reporting good news. Sales says 'seasonal adjustment,' production says 'raw material prices have risen,' R&D says 'competitors are maliciously cutting prices.'"

He threw the report onto the table: "Nobody is telling the truth—our product has already fallen behind."

Xu Jiaming took a deep breath, pulled out the third-generation prototype from his briefcase, along with that cost calculation sheet.

"The third generation, development is complete."

Li Ping'an took it, examined the prototype carefully. His fingers glided over the casing, pressed a button, watched the icons jump on the screen. Throughout the process, his face showed no expression.

Five minutes later, he raised his head: "Are the costs real?"

"Zhang Wei checked it three times."

"And the performance?"

"It comprehensively surpasses the second generation, with standby time three times longer."

Li Ping'an stood up, walked to the window. Outside, rain was still falling, all of Shenzhen shrouded in a grayish watery mist.

"A month ago, the president of Motorola China invited me to dinner." He suddenly said, "At the meal, he praised our second-generation pager, saying 'It's admirable that a Chinese company could reach this level.'"

He turned around, looked at Xu Jiaming, and asked: "Do you know what the subtext of that statement is?"

Xu Jiaming thought for a moment: "They are up high, looking down on us."

"Right." Li Ping'an walked back to the desk, "So the third generation can't just be 'good.' It must be so good that they can't sit still, so good that they too must cut prices and feel anxious."

He picked up the prototype: "999 yuan, this price has impact. But having just a price isn't enough; we also need something they cannot imitate."

"We have them." Xu Jiaming said, "Domestic chip cores, independent systems—these are our patent walls."

Li Ping'an smiled, a sharp‑edged smile Xu Jiaming hadn't seen in a long time.

"Then let's do it." He said, "I've approved the funds for tooling. Software team, go directly to the Nanshan Research Center to pull people. One month later——"

He paused.

"I want to see people lining up to buy Wanshang pagers at the Wangfujing Department Store Building."

For the next month, the Nanshan R&D Center turned into a city that never slept.

Zhang Wei split the team into three groups: the hardware group refined circuit designs, the software group polished the operating system, and the testing group ran nonstop stress tests around the clock. The cafeteria changed three meals a day to four, still serving wontons and noodles at midnight.

Xu Jiaming spent every day in the R&D Center, sharing a cot with the technicians. His white shirt had turned completely gray, his hair was so oily it could be used for cooking, yet the light in his eyes grew brighter.

On the twentieth day, the first batch of trial‑production units came off the line.

Five hundred units, all hand‑assembled. Test results: a 93% pass rate, with the main issue being the welding consistency of the RF modules.

On the twenty‑fifth day, the second batch of trial‑production units.

The pass rate rose to 97%.

On the thirtieth day, the third batch.

The pass rate was 99.3%.

"It's ready," Zhang Wei said hoarsely, "let's move to mass production."

Xu Jiaming watched the brand‑new machines on the assembly line and suddenly recalled the fanfare when the second generation launched two years earlier. Back then they had been just as excited and confident.

But in only two years, the market had changed.

"Old Zhang," he asked, "how long do you think the third generation can hold out?"

Zhang Wei adjusted his glasses: "Technical lifespan, at least three years. But market lifespan…"

He didn't finish.

But Xu Jiaming understood. The big mobile phones had already begun to drop in price; the analog‑signal models fell below ten thousand yuan this year and might reach eight thousand next year. Once digital cellular networks spread, the pager's end would truly arrive.

"So this may be the final battle," Xu Jiaming said softly.

"Then fight it beautifully," Zhang Wei patted his shoulder.

November 15, 1992, Beijing Wangfujing Department Store.

At seven in the morning, a long queue had already formed at the entrance. The line included everyone: businessmen in suits and ties, college students with backpacks, and older women carrying vegetable baskets.

"What are you lining up for?" a passerby asked curiously.

"Wanshang Pager, third generation, debut today!" a young man exclaimed excitedly, "I heard the standby time is especially long, the signal is superb, and it's cheap!"

"How cheap?"

"Nine hundred ninety‑nine!"

The passerby inhaled sharply—this price was more than half off Motorola's.

At nine o'clock sharp, the mall opened.

The crowd surged toward the electronics counter.

Above the counter hung a massive red banner: "Wanshang Pager Third Generation—Thousand‑Yuan Revolution, the Arrival of the Standby King."

Inside the counter, several hundred black pagers were neatly arranged. Their minimalist design, blue screens, glowed with a subtle sheen under the lights.

"I'll take one!"

"Give me two!"

"Any in stock? I'll pay extra!"

The sales clerk was so busy his feet seemed to leave the ground, and the cash register's abacus clattered loudly.

Xu Jiaming stood at the observation point on the second floor, watching the frenzy below, yet felt little joy.

In his hand he held a freshly received fax from Motorola's China office.

It contained only one sentence:

"Congratulations on the new product launch. Looking forward to meeting on the next battlefield."

The next battlefield.

Xu Jiaming looked up, gazing out the window.

At some point the sky cleared; sunlight pierced the clouds and fell on the bustling crowd of Wangfujing.

In the distance, a few youngsters carried brick‑sized big phones, walking while talking, their voices loud enough for the whole street to hear.

That was the future.

And he and his team had just won the final battle of a war that was doomed to lose.

But at least they fought beautifully.

"President Xu, the first‑day sales figures are in,"

The secretary ran over, panting: "In five hours, we sold 1,200 units. Inventory… is nearly depleted."

Xu Jiaming nodded: "Notify the Shenzhen factory, expedite production."

He cast one last glance at the buying crowd below, then turned and left.

Stepping out of the department store, the sunlight was perfect.

He pulled out his second‑generation pager—two years of use had worn the casing and scratched the screen. He pressed the power‑off button, and the screen dimmed.

Then he retrieved the third‑generation prototype from his pocket and turned it on.

The blue screen lit up, displaying the time: November 15, 1992, 2:17 p. m.

It was the dusk of an era.

And also the faint morning light of another era.