AAPL Apple Inc

By Li Yuan 

In China, Jia Yueting is known as "Jiabusi," or "Jia Jobs." The nickname refers to his well-known fixation with late Apple founder Steve Jobs, and "Jia" in Chinese sounds like "fake."

At product launches, Mr. Jia, founder and chief executive of video and gadget company Leshi Internet Information & Technology, wears bluejeans, gray sneakers and long-sleeve black T-shirts--a close imitation of Mr. Jobs's signature outfits. Leshi's first smartphone ad in April, which Mr. Jia said was his idea, ran Apple's iconic 1984 commercial followed by a tweaked version of it, in which Apple was portrayed as the Big Brother and Leshi as a fearless boy who ate the apple in the end.

In speeches and interviews, Mr. Jia refers to Apple constantly, promising to be the next innovative disrupter while bashing today's Apple for complacency. After a recent Apple TV launch, he wrote on his social-media account: "After Jobs, Apple has no disruptive innovation. Disappointed."

Like Mr. Jobs, Mr. Jia's vision has been to more deeply integrate content--particularly video--into devices. Leshi rose to prominence in China by being one of the first companies to sell local and Hollywood content to Chinese users eager to stream shows on their phones and tablet computers. It seeks to leverage that content to sell low-cost devices that feature streaming video front and center. The company charges the equivalent of $160 for its 16-gigabyte Le 1 phone, $432 for its 64-gigabyte Le Max phone and $272 for its latest 40-inch, liquid-crystal-display Internet television. And Mr. Jia is talking about building a car.

Now Mr. Jia is eyeing the U.S. Leshi--known in English as LeTV--is soft launching its online store LeMall.com in the U.S. this month, with an official launch in the second-quarter of next year. It isn't clear whether LeTV will sell its flat-panel TV sets or its new line of smartphones, but Mr. Jia said it shows LeTV's model is ready for a global debut.

Some are skeptical.

"LeTV has the potential to become a first-class company if it focuses on its Internet TV business," said Fang Xingdong, a consultant and longtime Internet observer. "Now it's doing all kinds of things. I don't get it."

China's markets corrections have also intervened. LeTV's listed arm, once the most valuable Internet stock in China's A-shares markets, has lost half of its value since May, down to a market cap of $12 billion. Its entry into the fiercely competitive smartphone market is burning cash. And its profit-making video-content business is competing with China's biggest Internet companies, including Baidu, Alibaba Group Holding and Tencent Holdings, which own or invest in the other top video sites.

Mr. Jia is undaunted. He said people either don't understand or misunderstand his company because they can't envision what he sees: a future in which people will consume LeTV's video content on LeTV's television, smartphone and car screens. Combined with the company's cloud system, those TVs, phones and autos will make up an ecosystem that will support and generate revenue for each other, he insists.

In the past few months, LeTV has added high-profile executives to run its car, Internet finance and international merger-and-acquisition units, respectively. It has set up a 600-person Internet car division with offices in Beijing and Silicon Valley, including more than 50 hires from Tesla Motors, Mr. Jia said. LeTV's Internet car will cost half of Tesla's, he claims, without giving much detail about the car.

Mr. Jia said he needs to make LeTV's business model more complicated so that Baidu, Alibaba and Tencent can't just copy it or buy it.

But that is an expensive, uphill battle, and his products haven't yet proven he can win. LeTV expects to sell three million smartphones this year, a tiny fraction of competitor Xiaomi's target of 80 million. Its Internet TV, launched in 2013, was a market pioneer and won many praises for its intuitive user interface. It sold 2.5 million units in 2014. Both devices are frequently sold near or below cost.

Mr. Jia admits his board of directors disagrees with him on most of his new initiatives, and wants him to follow video-content models such as YouTube and Netflix. He has dismissed their disapproval by putting the new businesses under a holding company so he can put his own money behind them. Mr. Jia, who started the company in 2004, owns over 40% of LeTV's listed arm and has used shares multiple times to fund his new initiatives.

Mr. Jia believes Mr. Jobs would have done the same. He said large cellphone companies such as Nokia and Motorola failed because of their boards. "That's why Apple was successful," he said. "When Jobs came back [from his exile], he had power over his board. His charisma convinced everybody he was right."

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(END) Dow Jones Newswires

October 07, 2015 15:44 ET (19:44 GMT)

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