BBK Electronics split into three companies to avoid internal competition

By the late 1990s, BBK Electronics, founded by Duan Yongping in 1995, had grown three distinct and increasingly promising businesses under one roof: educational electronics (learning machines and point-readers), audio-visual products (VCD and DVD players), and communications equipment (cordless and early mobile phones).

Duan's own earlier experience, having left a prior company after being denied an ownership restructuring he'd wanted for employees, shaped his belief that growth depended on incentive structures strong enough to make people behave like owners, not division managers reporting up a chain. Keeping three units as departments of one company, however they were incentivized internally, still meant they ultimately answered to one board and competed for one pool of capital.

Split the company into three independent firms with real equity, so each line behaves like an owner and pursues its own growth without compromise.

Separate ownership removes internal competition for capital and attention.

Real equity makes leaders act like owners, not division managers.

Each company can pursue its own market logic without parent sign-off.

Independence lets each scale and rebrand, becoming major smartphone makers.

When business lines will compete for resources, spin them off as independent companies with real equity, even if they become rivals.

In 2001, the audio-visual and communications companies jointly invested ¥30 million to register a new brand, OPPO, under Chen Mingyong, who later bought out the other shareholders' interest in it entirely. In June 2010, Shen Wei's communications company separately launched vivo as its own new brand, mirroring OPPO's earlier move — in both cases replacing an aging house brand with one built for younger, more international buyers.