Initially, Yang Yuan believed the problem wasn't too significant. Although the price was capped at no more than 20% above cost, Fantasy Computer's capabilities made it easy to eliminate competitors. Once most competitors were gone, they could then find ways to increase profits.
"From now on, for all orders from institutions and enterprises, our quoted price will remain around 110% of the total cost. We'll completely use our price advantage to eliminate all competitors!" Yang Yuan declared this strategy directly in an internal meeting.
Large corporations use their vast financial reserves and price tolerance to drive down prices and eliminate all other competitors, thereby dominating the entire market. This is the tried-and-true method for countless large corporations vying for market share. The strategy, while sounding quite conventional, is extremely effective. Many small businesses have been completely crushed by such strategies from large corporations.
However, when Fantasy Computer's marketing department submitted their price plans for bids, they discovered their prices were actually the highest among all the bids. The new competitors entering the industry were far more aggressive than Fantasy Computer had imagined. Fantasy Computer had at least maintained a 10% profit margin for itself. But these emerging competitors had only left themselves about 5%, and some companies even set their profit margin at 0%, quoting prices directly at the procurement cost while also offering full machine assembly and long-term after-sales service. The most ruthless competitors even quoted prices below the procurement cost, willing to incur losses just to enter the market.
This pricing strategy completely baffled Fantasy Computer. As a result, within just a month or two, Fantasy Computer lost more than 50% of its traditional market share, with a large volume of orders being snatched up by competing enterprises. After all, with current strict regulations, unless there's a very clear reason, only the lowest bid is selected during the bidding process. Of course, if a bidder falsely quoted a low price and ultimately couldn't deliver, or delivered products of extremely poor quality, the company had the right to refuse payment and even demand significant compensation from the bidder. Therefore, companies that won bids with low prices either had other channels to make back their money or were genuinely enduring losses to fulfill the order.
This situation was entirely beyond Yang Yuan's expectations. He couldn't understand where these competing enterprises got the money and the courage to play this game. This situation continued to trouble Yang Yuan until he met an investor, who finally cleared up his doubts.
"Because Fantasy Computer is already listed, while those competitors are not!" the investor revealed an answer that Yang Yuan had never expected. The investor then explained the intricacies to Yang Yuan. The logic was simple: the companies competing with Fantasy Computer were not using their own money, but rather the money of their "unfortunate" investors to compete with Fantasy Computer for market share.
Were these investors foolish, deliberately throwing away their money to have their invested companies compete with Fantasy Computer by losing money? Of course, these investors were not foolish, because their investments had the potential to yield returns of several times, or even tens of times, their initial capital.
"Do you remember the food delivery wars a few years ago? The logic is the same as here!" the investor said with a smile. "According to my information, at the peak of the frenzy, over 100 investment institutions invested in more than 300 food delivery platforms simultaneously, injecting a total of hundreds of billions of renminbi. The means these food delivery platforms used to fight for market share were also very simple and brutal: they used subsidies and price cuts to gain market share, and the effect was outstanding. Platforms that succeeded, like Dida Food Delivery and Tiantian Food Delivery, had valuations of tens of billions of dollars at their peak. As long as these companies successfully went public, investors would see several times their returns in the stock market."
"If it weren't for the anomaly of 'E Bu Pa' appearing in the end, I would be a billionaire now!" the investor said with a look of frustration, implying that his investment institution had invested in someone else's food delivery platform. Of course, the worst off were the investors who had invested in Dida Food Delivery, as this food delivery service had been directly suspended due to massive financial losses, with all its assets being liquidated to repay creditors. As for the money invested by other investors, it was likely impossible to recover, as the recovered assets weren't even enough to cover one-third of the creditors' debts, let alone return the investors' money – that was pure fantasy.
"But ultimately, at most, only two or three companies can go public, right? Wouldn't the institutions that invest in other companies be completely ruined?" Yang Yuan asked helplessly.
"Yes, but so what? It's not their own money that's being lost anyway. And money in hand must be invested, so they can only choose to invest in a company that appears to be on the rise."
"And currently, computers related to the Lingyun system in China are one of the biggest trends. According to our investigations, the market share of the Lingyun system within China is constantly increasing, and many individual users are prioritizing computers with the Lingyun system when replacing their old ones."
Yang Yuan remained silent. He already knew this survey result because Fantasy Computer was constantly monitoring changes in the personal computer market. Therefore, while enterprise and institutional users were Fantasy Computer's largest market, the personal computer market represented the overall market trend. And now, China's personal computer users were comprehensively abandoning the Windows system. The main reason, of course, was the disgusting actions of Microsoft, and China's media would not actively conceal them for Microsoft. On the contrary, with growing nationalistic sentiment, Microsoft's reputation was plummeting. Unless they were die-hard unpatriotic individuals, almost everyone would prioritize domestic computer systems.
Of course, this was just a prerequisite. If the Lingyun system couldn't replace Windows in terms of functionality, it still wouldn't be able to capture more market share. But the problem was that Jiangnan Group very cleverly migrated the entire terminal application software ecosystem to the computer system, filling the void of insufficient software right from the start. Moreover, because this allowed data to be quickly shared between terminals and computers, forming a situation where both shared a single screen, many heavy terminal users, and even enterprise office users, were enthusiastically using the Lingyun system. This allowed them to switch between their terminals and computers more efficiently to meet their needs.
For some users focused on gaming or workstations, the current Lingyun system might still have some shortcomings, but the Lingyun system was also working hard to catch up in this regard. Since the 00 Game Center was owned by Jiangnan Group, the 00 Game Center not only launched a Lingyun system version immediately but also promoted a massive subsidy policy. This policy encouraged its affiliated game development studios to adapt their Windows system platform games into Lingyun system versions and to include Lingyun system versions in their future new games. As long as they did this, the 00 Game Center would provide corresponding subsidies, advertising recommendations, and other benefits. Many game companies had already announced that they were developing games for the Lingyun system. As for game studios directly controlled by Jiangnan Group, such as Blizzard, they launched Lingyun versions of almost all their games immediately upon the release of the Lingyun system, clearly having started development long ago. Therefore, although a large portion of games might not be playable on the Lingyun system, the most classic games were still available.
As for those who used computers as their core productivity tools in various workstations, their adoption of the Lingyun system was actually faster than other groups. This was because the Lingyun system was developed based on a five-value computing system, and its capability in handling multi-threaded computations was far superior to traditional binary computer chips. A computer of the same price that required 24 hours to complete rendering under the Windows system could possibly finish in less than 7 hours, an improvement of over 60%. Workstations that relied on computers for core productivity simply could not refuse the significant increase in work efficiency brought about by the Lingyun system. The only limitation they might face was whether relevant professional software had developed Lingyun system versions.
Jiangnan Group had already begun negotiations with these professional software vendors. If they were willing to develop Lingyun system versions of their software within two years, Jiangnan Group was willing to provide financial support. If they were unwilling to develop them, it didn't matter, as Jiangnan Group could develop them themselves. With Jiangnan Group's vast technical development capabilities, this was truly not a problem. Moreover, because these were programs developed based on the five-value system, there were no concerns about intellectual property infringement. As long as Jiangnan Group developed them, the relevant intellectual property rights would undoubtedly be held by Jiangnan Group. Therefore, professional computer engineering software on the market had also begun to yield and obediently develop Lingyun system versions of their software. And once these software programs were all in place, it was likely that the Lingyun system would completely drive Windows out of the domestic market.