King of Technology: A Fresh Start in 1983

October 1991, Shanghai Exhibition Center - National Computer and Application Products Exhibition.

Above the Tiangong booth hung the slogan "Xuanyuan Breaks the Dawn, Leading the Future with Intelligence".

Distributors, industry users, and reporters carrying cameras from various places were scattered around.

Zhao Xiaobo, dressed in a dark gray suit, shouted hysterically:

"Distinguished guests! Today, Tiangong officially launches its first self-branded PC – the [Xuanyuan 386]!"

The large screen displays the specifications:

CPU: Intel 386DX/40

Memory: 4MB

Hard drive: 120MB

Graphics card: Tiangong [Pangu I] graphics accelerator card

Sound card: Creative Sound Blaster 1.0

Monitor: 14-inch VGA color CRT

Operating system: MS-DOS 5.0

Price: 18888 yuan!

"18888?! That's insane!"

A murmur suddenly broke out among the passing crowd.

At this time, the Lenovo booth featured the 386SX/25 model, priced at 15500 yuan.

The same product at the Founder booth was priced at 14999 yuan.

Zhao Xiaobo raised his voice: "Tiangong embodies the technological value and quality of [Xuanyuan]!"

"Our Pangu I graphics card supports 1024x768 high-resolution display and hardware graphics acceleration, far surpassing ordinary VGA cards!"

"The Sound Blaster sound card delivers a true PC audio experience!"

"The entire machine has undergone 72 hours of rigorous aging testing, demonstrating industry-leading stability!"

The demonstration began amidst Zhao Xiaobo's hoarse voice.

Zhang Wei and Zhao Lin ran a wireframe model rotation demo in AutoCAD R12 to demonstrate its graphics acceleration capabilities.

The program also played Andy Lau's "The Days We Walked Together" and "Endless Love," and Leon Lai's "Will You Come Tonight" and "Sorry, I Love You"...

The smoothness of the picture is indeed significantly better than that of a regular VGA card, and the sound effect is clear.

However, many dealers and users still showed hesitation…

"Too expensive!"

One week after the exhibition ended, at the headquarters of Pengcheng Tiangong.

Zhao Xiaobo walked into Chen Jianghe's office, holding the sales report, his brows furrowed.

"Of the first batch of 500 units, less than 50 were sold in Beijing, Guangzhou, Shenzhen, and Shanghai in three days!"

"The reason?" Chen Jianghe's face was gloomy.

"The key is the price!"

Zhao Xiaobo said with a wry smile, "Compared to similarly configured models from Great Wall, Lenovo, Inspur, and Founder, our 18888 is far too expensive!"

"Some customers have reported that the speed-up of [Pangu I] when playing Prince of Persia in DOS is not significant."

"Some features of the sound card are practically 'dispensable'!"

A week later, the market manager urgently reported: "Flyers for 'Chao Hui 386' are everywhere in the Zhongguancun electronics market!"

「配置标着386DX/40、4MB内存、120MB硬碟，只卖14888！」

Chen Jianghe's eyes turned cold: "Where did Zhong Chaohui get the complete machine?"

Zhao Xiaobo, who was standing nearby, said, "They assemble them in small workshops in the south, slap a label on them, and call them brand-name machines."

"There are many of these assembled PCs on the market now. The graphics card is a Trident 8800CS, and there's no sound card at all!"

"But many users only care about low prices!"

This blow to the head made Chen Jianghe feel a tightness in his chest.

"Immediately notify the core team members in Shenzhen: a meeting in the conference room in half an hour!"

The atmosphere in the meeting room was heavy.

Zhou Yuguang and Lin Wei, who had just arrived in Shenzhen from Beijing, along with Zhao Xiaobo, Wang Liping, and others, were present.

"The responsibility lies with me!" Chen Jianghe stated bluntly. "We were overly optimistic about the PC market, and our pricing strategy was flawed!"

"In particular, Tiangong's advanced technological advantages have failed to translate into consumer perception!"

"We now have two paths before us. Let's hear your opinions."

"The first option is to lower prices. Price them to compete with major manufacturers like Lenovo and Founder."

"The second option is to scale back sales and postpone the market promotion of the [Xuanyuan] PC until the [Pangu II] goes into mass production!"

"Fully support the development of [Pangu II] and prepare for the arrival of multimedia technology..."

"I choose option two!"

Before Chen Jianghe could finish speaking, Zhou Yuguang immediately declared, "For Tiangong, competing on price is slow suicide; technology is our true value!"

"We should pave a path to a blue ocean, not get caught up in a price war in a red ocean."

Lin Wei immediately seconded, "Moreover, our production line in Pengcheng is just starting out, with a yield rate of only 65%, and we can't compete with established PC manufacturers in terms of cost."

Hearing Zhou Yuguang and Lin Wei's words, Zhao Xiaobo became anxious: "We can't back down! Once we lose our channels and customers, it will be difficult to re-enter this market!"

Chen Jianghe looked at Lin Wei: "Lin Wei, how's the progress of [Pangu II] FPU?"

Lin Wei said, "The architecture is finalized, and the simulation has passed. Tape-out and verification will take another 3 months, and mass production... will take at least half a year!"

"Six months?" Zhao Xiaobo's voice was filled with anxiety. "Six months from now, the market will have been completely taken over by others! Our distribution channels will be utterly destroyed!"

Zhou Yuguang looked at Zhao Xiaobo: "Xiao Zhao! You need to think long-term! Lowering prices might temporarily protect your distribution channels, but it's a short-sighted solution!"

"The brand value of [Xuanyuan] will be completely ruined! All the technical reputation we've worked so hard to build will be destroyed!"

He turned to Chen Jianghe: "Jianghe! Tiangong's core value lies in technology, innovation, and things that others can't do!"

"Pangu II is our future! Its multimedia acceleration capabilities will be a revolutionary experience!"

"Over the years, from the [Xuanyuan Card] to the [Pangu Card], haven't we consistently pursued a path of technological advancement?"

"I believe Tiangong should concentrate all its resources to ensure the successful development and timely mass production of [Pangu II]!"

"Continue to leverage technological superiority to completely outpace our competitors! Create our own niche markets and high-end segments!"

A brief silence fell over the meeting room.

Zhao Xiaobo opened his mouth, but looking at Zhou Yuguang and Lin Wei's eyes, and then at Chen Jianghe's pensive expression, he swallowed his words.

Over the years, Tiangong has invested a great deal of human, financial, and material resources in product research and development and technology…

How far can this path go if we don't find a way to make money as soon as possible?

Zhao Xiaobo frowned, looking worried.

At this moment, Chen Jianghe's gaze swept over everyone.

"Mr. Zhou and Dr. Lin are right! Tiangong's path lies in technology, innovation, and irreplaceable value! We cannot fall into the dead end of a price war!"

"【Xuanyuan 386】Maintain the current price."

"Targeting professional users with realistic graphic needs, it highlights the acceleration advantages of professional software such as AutoCAD."

"Focusing on customer experience and perception, building a reputation for Tiangong's technology, and warming up the market for the [Xuanyuan] brand."

"We're not pursuing mass-market sales for now! We need to avoid getting bogged down in pointless price wars!"

"Concentrate all human, material, and financial resources to ensure the research, development, and mass production of [Pangu II]!"

Zhou Yuguang slammed his hand on the table: "Good! Jiang He! This is the path Tiangong should take!"

Lin Wei nodded emphatically: "Yes! Concentrate our efforts and work relentlessly on the technology! Let's make [Pangu II]!"

...

The price war encountered in the market by [Xuanyuan 386] prompted Chen Jianghe to reflect deeply…

This also laid the foundation for Tiangong's future "technology, industry, and trade" strategy.