Beijing-based B2C e-commerce platform JD.com (Nasdaq: JD) and Chinese voice recognition software firm iFlytek (002230.SZ) plan to form a joint venture focused on the development of smart home products, according to a press release issued today by iFlytek.
According to the agreement signed by the two companies, iFlytek will contribute RMB 82.5 mln, or 55% of the new JV's total registered capital, and JD.com will put in RMB 67.5 mln for the remaining 45%.
iFlytek says it holds roughly 70% of China's voice recognition software market, and counts Tencent's (0700.HK) Mobile QQ instant messaging service and Sina's (Nasdaq: SINA) Weibo (Nasdaq: WB) microblogging service among the major platforms using its technology.
JD.com, which boasted 96.6 mln active customer accounts by the end of 2014, will bring its strong distribution channels to the JV, and will assist in product design. iFlytek will provide its technology solutions.
Editor's Note: According to Chinese news agency Xinhua, Taiwan's Topology Research Institute estimates that the value of China's smart home market reached USD 3.8 bln in 2014, and forecasts that it will grow 26% to reach USD 4.8 bln in 2015.