Terry Gou, chief of Foxconn, spoke at a news conference in Shanghai after a groundbreaking event celebrating the construction of a new headquarters. One of the subject matters concerned the working conditions and how both Foxconn and Apple plan to split the costs to improve the situation. But he also blurted out a little secret that seemingly confirms every rumor regarding Apple developing its own HDTV.
According to Gou, the company is making preparations to manufacture Apple's iTV device. However he added that development and manufacturing has yet to begin. Foxconn's recent 50-50 joint venture factory with Sharp in Japan is one of the preparations made for the new device, he said. Apple's iTV is slated to feature an aluminum construction, Apple's popular Siri, and FaceTime video calling.
Prior to talking about Apple's iTV, Gou said that Foxconn -- or Hon Hai Precision Industry Co Ltd -- plans a renewed push into distribution. The business model of the new e-commerce services will provide clients with "one-stop" services ranging from manufacturing to logistics and reselling to consumers. "You will see a brand new e-commerce business in two years," he said.
Foxconn has wanted to enter the e-commerce sector for years. It invested around $14.3 million in establishing e-commerce website e-feihu.com, but three years later the site has failed to catch up with industry leaders Taobao and 360.com. The company also attempted to launch a distribution network in 2009, but that didn't work out well either.
The new 50,000 square meter headquarters (or 10,000 or 80,000, the number is mixed) is a symbol of Foxconn's new direction. It's due to be completed in 2015, and Foxconn's manufacturing and operational headquarters will remain in the southern city of Shenzhen. Currently the company employs more than 1.2 million workers at 30 locations in mainland China.
As reported on Thursday, both Apple and Foxconn are "spending heavily" to combat years of reports that Foxconn factories are nothing more than sweatshops with working conditions so poor, workers are leaping to their death off factory rooftops. As seen in the last few months, Foxconn is pushing hard to clean up its image while Apple has encouraged changes with a series of audits. Now both parties plan to financially get the factories up to par and out of the gossip channel.
"We've discovered that this [improving factory conditions] is not a cost. It is a competitive strength," Gou told reporters. "I believe Apple sees this as a competitive strength along with us, and so we will split the initial costs."