Chapter 191: 3,999 Yuan? That's Way Too Expensive! I Think It's Expensive Too

Void City, the Sky Garden — Sister Chengzi's new phone launch event.

The moment Wang Teng finished speaking, the press area's flashbulbs began firing nonstop, lenses aimed at the big screen where the 799 yuan price tag stood out boldly.

"799 yuan?"

Huawei's Yu Chengdong froze for a beat, his mouth falling open, his mind instantly thrown into chaos.

The similarly specced Motorola XT883 had launched last August — also a 4-inch screen, 512 MB of RAM and 8 GB of ROM — priced at 1,499 yuan.

Granted, on the processor side, the Chengzi D1 used a MediaTek MT6573, a mere 650 MHz single-core chip, which lagged behind the Motorola XT883's 1 GHz processor.

Yet the Chengzi D1 cost only half the price of the Motorola XT883.

With those specs and that price, the Chengzi D1 would be unbeatable in the mid-to-low-end market.

Yu Chengdong silently tallied up the BOM cost in his head — even with DST stepping in to help Chengzi Tech optimize its supply-chain pricing, the Chengzi D1's hardware cost still had to be at least 400 to 450 yuan.

Add in R&D, sales, after-sales, shipping and management costs, and this phone's gross margin was at most 10%.

So Chengzi Tech was clearly planning to go all-in on this path. He'd assumed the Chengzi C1 smashing a 2,999-yuan / 3,999-yuan spec sheet down to 1,999 yuan was just a low-price play to grab market share.

Once it had established a firm foothold, it would roll out higher-margin new products.

But in the Chengzi D1's pricing, Yu Chengdong saw no such trend.

Meizu's Huang Zhang thought it over for a moment, then the crease between his brows smoothed out — the Meizu MX was priced at 2,999 yuan, a different price tier from the Chengzi D1, and its specs far outclassed the D1's, so naturally he wasn't worried.

It was OPPO's Chen Yongming and Ku Sect's Guo Yingde beside him who looked troubled — the Chengzi D1's launch would inevitably hammer both companies' mid-to-low-end models.

Phones with the same specs, their two companies sold for around 1,500 yuan, while Chengzi Tech only asked 799 — how were they supposed to compete?

The two men stared at Wang Teng, grinding their teeth in fury.

Lei Yi silently swept his gaze around the room, taking in every complicated expression on the competitors' faces, then turned his eyes to the calm-looking Chen Yansen and couldn't help asking: "President Chen, the Chengzi D1 is priced way too low — you're forcing Ku Sect, Lenovo and ZTE to cut prices. That's ruthless."

Too low?

Too ruthless?

Chen Yansen smiled, muttering inwardly: When you were using Redmi phones to grab the end-user market, you didn't give a damn about your competitors' survival either.

"President Lei, we're all industry insiders — you can calculate the Chengzi D1's BOM cost too. Last year smartphone shipments were over 80 million units, more than double 2010's. Prices for screens, chips, batteries, cameras, housings and PCBs are all dropping. At 799 yuan there's still money to be made."

Chen Yansen replied unhurriedly.

Lei Yi heard that, shook his head helplessly, and said nothing more.

After all, in the eyes of Chen Yongming, Guo Yingde and Yu Chengdong, he and Chen Yansen were cut from the same cloth — the shit-stirrers of the phone industry.

The two men's business strategies were much alike: proactively slash hardware margins, trade volume for market share, then leverage scale to make money on the software side.

Hardware gross margins basically sat between 5% and 10%.

What Lei Yi didn't know was that Chengzi Tech, riding on DST's network of contacts and its 11.25 million-unit shipment volume, had negotiated even lower procurement prices with MediaTek, BOE and Desay.

In reality, the Chengzi D1's BOM cost was only 390 yuan.

At that moment, Wang Teng on stage pressed the remote, and the big screen behind him immediately switched images.

The Chengzi D1's CG render vanished, replaced by a new smartphone with an oversized screen and an ultra-thin body.

"Chengzi C2! Continuing the previous model's extreme performance, it's only 8.6 mm thick with bezels just 3.9 mm wide. Like the Chengzi C1, it uses full gesture control.

It packs a Qualcomm Snapdragon MSM8260 dual-core processor and a 4.7-inch AMOLED touchscreen — faster response, lower power draw."

Wang Teng took the cue and announced the second new model's name.

The image behind him rotated accordingly; when showing the thickness and bezel width, a coin stood upright beside it as a reference.

For the screen, the Chengzi C2 switched to a more capable AMOLED panel — BOE's latest product launched at year-end, positioned against Samsung's Super AMOLED Plus touchscreen.

Although BOE's yield rate trailed Samsung's and its production cost was far higher, BOE still offered a supply price of 260 yuan per panel to land Chengzi Tech's order.

Even 10 to 20 yuan cheaper per panel than Samsung.

The screen's BOM cost alone matched that of a single Snapdragon MSM8260 chip.

Hearing this, Lei Yi instantly understood — Chengzi Tech had finally set its sights on the high-end market too.

"The standard version has 2 GB of RAM and 16 GB of storage, supports 1080p full-HD video playback and recording, a 16-megapixel rear camera, a 5-megapixel front camera, runs Aurora OS 1.3, packs a 2,620 mAh battery and supports fast charging."

Wang Teng continued.

From an engineering perspective, he walked through the industrial-design angle and detailed the principles behind Chengzi Tech's fast-charging tech. To keep fast charging safe and stable, they'd added a charging management system and protection mechanisms — over-voltage, over-current, overheat and short-circuit protection, among others.

Wang Teng's tone was sincere; whenever he touched on Chengzi Phone's proprietary tech patents, he would walk from the design scheme all the way to product implementation, making users instinctively feel a strong sense of trust.

On exterior design, the Chengzi C2's looks lost nothing to HTC's One X or Sony's LT26i — it even looked more high-tech than the iPhone 4S.

When it came to the Aurora OS 1.3 operating system, Wang Teng was positively unstoppable — after all, it was the fruit of nearly half a year's work leading his team.

"This kid really sneaks in a lot of self-promotion."

Chen Yansen muttered under his breath.

A smartphone, from hardware to software, involves too many and too tangled supply chains and tech chains — like a skyscraper.

Although he wanted to ditch Microsoft's, Qualcomm's and Nokia's communications tech patents, domestically Chengzi Tech had no alternatives.

Chen Yansen was a fast learner, but he could only take it slow.

Technologies like Aurora OS 1.3, battery fast-charging, memory-cleanup algorithms and AI imaging, plus the hardware design — without his product blueprints, it would've taken at least another year and a half before any of it became possible.

After all, companies like Qualcomm, Samsung, Ericsson, Nokia and Motorola had been accumulating communications and handset tech patents for over twenty years.

Chengzi Tech, meanwhile, had been around for less than a year.

Chen Yansen narrowed his eyes, running through his New Year plans in his head.

He had no intention of biting off more than he could chew, but with his spiritual force more than a dozen times that of an ordinary person, plus ample funding and R&D staff, picking one point of focus — an operating system or a core component — and drilling deep would absolutely let him reach the industry's top tier in extremely short order.

He had no desire to hand over the bulk of the profits to someone else.

Just as he was thinking, Wang Teng unveiled the launch price: 3,999 yuan.

From 1,999 yuan to 3,999 yuan — Chengzi Tech's mainstream model had jumped 2,000 yuan in one go.

The fans below the stage found it hard to swallow: at 1,999 yuan, everyone was still friends; at 3,999 yuan, there was suddenly distance.

Yu Chendong and the others grinned, thinking: Chen Yansen is a businessman after all—how could he possibly keep selling a product that doesn't make money?

The 3,999 yuan price tag instantly took the pressure off them.

To be frank, with the Orange C2's specs, the BOM cost alone was close to 1,800 yuan. If it were Meizu, HTC, or Samsung, the price would absolutely be set between 3,500 and 4,500 yuan.

The YY Live staff in the audience instinctively glanced at the comment section—messages were packed dense, a wall of abuse.

"Heh! Just now he was saying he wanted everyone to be able to afford a phone, and in the blink of an eye he's lost his head!"

"3,999 yuan—how dare Orange Tech!"

"Damned right! Without our support, could Orange Tech have gotten where it is today?"

"Shameless profiteer! Pfft! I'd rather buy a Samsung!"

Clearly, the 3,999 yuan price tag still exceeded many people's expectations.

Even though they knew perfectly well that the Orange C2's specs were flagship-grade—bundled with a deeply optimized Aurora OS 1.3 operating system and fast-charging thrown in—selling it at 3,999 yuan was perfectly fine, that didn't stop them from cursing up a storm.

"Too expensive, isn't it?"

Wang Teng smiled faintly, then answered his own question: "I think so too. An ordinary worker at the Orange phone factory earns 7,000 yuan a month before tax, and buying one Orange phone costs half a month's salary—very unreasonable."

How much?

Seven thousand a month?

The barrage in the YY Live stream froze on the spot; everyone's brain short-circuited a little.

In 2012, most fresh college graduates started at around 3,000 yuan a month—some didn't even get that.

To earn 7,000 yuan a month, you first needed a degree from a key university, and second, a popular major—only then was it possible.

And now Wang Teng was saying that ordinary workers at the Orange phone factory earned 7,000 yuan a month.

So what was the point of all those years they had slogged through school?

Love of learning?

Many college students in the livestream broke down, and immediately typed into the public screen: "Boss Wang, can you take that back? A friend of mine saw it and feels terrible."

"Same here, a friend of mine!"

"Me too!"

Wang Teng naturally couldn't see the comments in the livestream. He paused, then said: "I also think it's expensive, I can't afford it either, so after much deliberation, I've decided to drop the price to 2,699 yuan!"

The audience at the venue and in the livestream froze for a moment—they hadn't expected the price-drop trick to come out.

That move was wildly unorthodox, catching both rival brands and fans completely off guard.

Even Lei Yijun hadn't expected such a stunt at a new-product launch.

"Nice move. I'll have to learn that one." Lei Yijun thought to himself.

From 3,999 yuan down to 2,699 yuan—a single slash of 1,300 yuan.

The atmosphere in the venue instantly livened up; many potential buyers began toying with the idea of switching to the new phone.

After the buzz in the audience died down, Wang Teng announced the 32GB version at 2,999 yuan and the 64GB version at 3,499 yuan.

Huang Zhang, who had been holding it together until now, panicked. Meizu's MX, launched on New Year's Day, was priced higher than the Orange C2 and specced lower—how was he supposed to play that game?

Xu Zhenhui and his secretary sat in the front row. Though he knew nothing about phones or business, judging from the reaction in the room, the Orange C2's future sales were sure to be strong.

On Weibo, plenty of netizens gathered in the comment sections of Orange Phone and Chen Yansen, heatedly debating the specs, pricing, and other details of the Orange D1 and Orange C2.

At the same time, the launch event was drawing to a close.

On the Orange Mall homepage, the activity entry for the Orange D1 and Orange C2 engineering versions finally popped up.

Sales opened promptly at 12 o'clock.

Each model had only 300 units in stock. Even with user level, IP, and shipping address restrictions, they sold out within minutes.

Finally, Wang Teng announced that the official sale date for the Orange D1 and Orange C2 was set for January 14th, with delivery handled door-to-door by Yunsu Express.

In a single launch event, Wang Teng had done promotion for three companies under Senlian.

What Chen Yansen hadn't expected was that on the trending-search list, the trending term for the Orange new product was actually crushed beneath the trending term for Orange Phone Factory's employee benefits.

"For real? 7,000 yuan a month? These phone-makers just love shooting their mouths off."

"My cousin actually tightens screws at the Orange phone factory—six to seven thousand something a month, and in October he pulled in almost 8,000 yuan. To be fair, it's all from overtime."

"I told you so—how could there be such a fairy-tale factory!"

But once workers from the Orange phone factory showed up in the comments to share their work experiences, netizens gradually learned the truth.

The Orange phone factory runs a six-hour workday.

Meals and housing included!

Overtime on weekdays pays 1.5x, weekends 2x, holidays 3x!

Literate, quick-witted employees also get the chance to train in the repair department; once they pass probation, they can become after-sales engineers, earning over ten thousand yuan a month with much lighter work.

This made netizens cry out: only ten hours a day? I'm doing twelve hours a day right now, and I don't even get overtime pay.

Many people were clamoring to go to Shencheng to tighten screws—some joking, some genuinely meaning it.

After the launch came the luncheon and thank-you proceedings.

It wasn't until three in the afternoon that the invited guests began to leave one after another.

After seeing off Lei Yijun and the others, Chen Yansen turned back to the hotel and walked into a private room on the top floor together with Ye Qiuping.

(End of chapter)