India's Air Force clips Xiaomi's wings

The Indian Air Force is the latest party to react to allegations against Chinese smartphone maker Xiaomi regarding the transfer of International user data to Beijing.

The Indian public may have lapped up anything and everything that leading Chinese smartphone manufacturer Xiaomi threw at them in the latter half of this year — from its super-value Mi3 smartphone to the budget Redmi 1S — but the Indian Air Force isn't buying any of it.

India Air Force clips Xiaomi wings

A few days ago, India's Air Force warned its employees and their families that their personal data is being shipped over to servers in China and that the phones therefore constituted a security risk.

Mint newspaper reported an advisory issued by the Indian Air Force that said, "F-secure, a leading security solution company, recently carried out a test of Xiaomi Redmi 1S, the company's budget smartphone, and found that the phone was forwarding carrier name, phone number, IMEI (the device identifier), plus numbers from address book and text messages back to Beijing."

According to an article in the Wall Street Journal, the debacle has its roots in an online post submitted by a Xiaomi RedMi Note user who said that the phone was "secretly" connecting to a Beijing server, even though the person had deactivated all backup functions. That's when Finnish company F-Secure decided to investigate this claim further.

An article by ZDNet's Liam Tung reported that Xiaomi's VP-International Hugo Barra explained the situation as nothing more than a part of Xiaomi MIUI's cloud messaging service and an effort to reduce latency and failure rates. Reacting to the controversy, the company has since issued an update that encrypts the data and now transforms the service to one that requires manual activation.

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Clearly, Xiaomi's fortunes in India do not hinge on users of its phone that are employed by the Indian Air Force. And there are many middle-class Indians who may not yet care about things like data privacy over a lip-smacking price for a value smartphone unlike any other in the market. However, all it could take is one paranoid user posting about his or her own experiences here that resonate in some powerful way with the crowd to start an internet conflagration that torpedoes the future of a wildly successful phone brand.

After all, India has joined the world in expressing anxiety about Chinese telecom equipment being used in India and the possibility of it being loaded with spyware. This has been a loud enough alarm cry ringing across several countries, from Canada to Australia, that asks for a curb to be placed on the purchase of Chinese telecom equipment brands.

Indeed, one of the inspirations for India's National Electronic Policy, blueprinted a few years ago, was to decrease the reliance on Chinese firms providing the guts of the Indian telecom infrastructure, although nothing seems to have happened on that front due to the sheer lack of vendor options.

Meanwhile, ZDNet has reported that Xiaomi is shifting all of its major services and data from Beijing to Oregon and Singapore. With big plans for India — a market that has gobbled up its phones during its test runs here, with an appetite seldom displayed for any other brand — the Chinese phone major will hope that the Indian Air Force's announcement won't trickle down into the civilian sphere.