Huawei aims to become tier one smartphone supplier

[cirr]

Huawei aims to become tier one smartphone supplier

Bill Goodwin Tuesday 16 September 2014 13:01

Chinese telecoms company Huawei is riding the bring your own device (BYOD) wave as it seeks to become a credible competitor to Apple and Samsung in the smartphone market.

In a wide-ranging interview, Shao Yang, vice-president of the company’s consumer marketing business, said business consumers would form a major part of tits strategy to become a serious player in smartphones.

“Huawei has a really big potential in the business market,” he said.

The company is developing technology - rivalling Samsung’s Knox software – that will allow companies to segregate corporate data from employees' personal data on mobile phones and tablets.

And it is developing high-specification smartphones for business users that feature large screens, fingerprint recognition and single-touch turn on, Shao revealed.

Huawei's said its smartphone shipments have grown from three million in 2010 to a predicted 80 million plus this year.

The company, which owns 6.9% of the global mobile market, is moving away from being a pure business technology provider to become a combined business and consumer product supplier.

Huawei’s strengths in 4G and telecoms infrastructure give it a natural edge over competitors, such as HTC, Research in Motion, LG and Sony, Shao claimed, in an interview at Huawei’s 40,000 strong campus in Shenzhen.

“We believe technology is very important. First, hardware, and Samsung is best at this part. Second is software, and Apple is best. Third is telecommunication, connecting to the network, and Huawei is best,” he said.

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The company, which employs 150,000 people worldwide, is spending over 12% of its $40bn (US) revenues a year on research and development.

It is focusing on improvements to hardware, including more advanced screens, batteries and cameras, and advances in software to make smartphones more intelligent. The company also designs its own chipsets.

Huawei's third element of research aims to provide its phones and tablet with an “emotional” quality, that Shao hopes will make the experience of using a mobile device a less isolating one.

“We want to go back to family. Because recently we find that even people who are in a family don’t talk to each other. They stay with their own phone even when they are having dinner,” he said.

Windows
In a potential blow for Microsoft, Shao revealed that Huawei has suspended its development of Windows phones and is now focusing its efforts on Google’s Android operating system.

Windows phones have not sold well compared with Android and Apple smartphones.

“The biggest problem with Windows is that a lot of things are predefined, leaving no space for the supplier. So if we look at the supplier market, each Android phone is quite different. They have their own potential. Windows phones are quite similar,” he said.

Target market is overseas, not China
Huawei sells more than 52% off its mobile equipment in China, but Shao is candid enough to admit that the home market is not Huawei’s real strength.

HUAWEI MOBILE DEVICE SHIPMENTS (UNITS)
2010 – three million
2011- 20 million
2012 – 32 million
2013 – 52 million
2014 -80 million (target)

“We are not good at the Chinese market. So if you look at the Chinese market, we are number five,” he said.

The bulk of the demand for smartphones in China is for $60 or $70 phones, not the higher-end phones with a price tag of $150 plus that Huawei wants to be known for.

“We think the potential is outside of China, ” he said.

Europe and UK

In Europe Shao identifies France and the UK among the most challenging and important markets for the company.

The French market is brand conscious, so it can be more difficult for lesser known suppliers to make an impact.
“The French market is an operator-dominant market. They use the good brands to compete with each other. For them the brand is most important,” he said.

The UK, meanwhile, is highly competitive, which means manufacturers need to spend heavily on advertising to promote their products if they want to get ahead.

“For Huawei, we are not such a rich company, so its hard for us to invest, to make the advertising,” said Shao.

That means choosing the right overseas business partners with the resources to promote Huawei’s phones is essential.

In the UK, Huawei has teamed up with EE, which has taken what Shao describes as an :"aggressive” approach to rolling out the latest 4G mobile phone technology.

US market
Huawei’s trade with America has become politicised following US concerns over potential security risks posed by deploying Chinese-made telecoms infrastructure.

But sales of mobiles are increasing and the company has moved from supplying phones under other operators' brands to selling Huawei-branded phones, said Shao.

“The US market has always been very positive. It is about 5% to 8% of our shipment,” he said.

Sceptics
For those questioning whether Huawei can make it into the top tier of smartphone manufacturers, Shao says the company has made similar transitions in the past.

“I joined the company in 1988. At that time we wanted to be number one in wireless.” he said.

Huawei was up against seven competitors, each with more advanced technology. “We hit a lot of difficulty,” said Shao. “Now we are number one in wireless.”

Huawei’s secret, claims Shao, is its willingness to listen to its customers, and to put their needs first. “The customer is more important than Huawei,” he said.

This is something that companies such as Apple are not so good at, he suggests. “Apple doesn’t listen to its customers very well,."

Huawei aims to become tier one smartphone supplier

 

[cirr]

Huawei plots red reign: Chinese boss with plans for international domination

By PETER CAMPBELL FOR THE DAILY MAIL IN SHENZHEN, CHINA

PUBLISHED: 00:02 GMT, 17 September 2014
UPDATED: 00:02 GMT, 17 September 2014

The bell rings. A handful of office workers jump up. Piped music begins to play over a speaker system, sparking a synchronised and frenetic dance routine, despite nearby colleagues still beavering away.

This is part of the compulsory exercise programme for all workers at Chinese telecoms giant Huawei’s headquarters.

The campus in Shenzhen – a Chinese city twice the size of London and only two hours’ drive from Hong Kong – stretches for more than a mile and houses a third of the group’s mammoth workforce.



When Deng Xiaoping, the first People’s Republic leader after Mao Zedong, was searching for ways to boost the country’s economy, he honed in on a patch of land just behind a sleepy fishing village on the south coast. This area was to become the first ‘free enterprise zone’, established in 1980.

Private ownership of companies and a competitive tax rate would attract start-up businesses and government projects would build housing for the thousands who would flock to the new city.

Seven years later a former Red Army officer, Ren Zhengfei, would join the throngs heading to Shenzhen having spotted a gap in the communications market.

Although development was still stunted compared with the years that would follow, the country already had 50m phone lines – with room for aggressive expansion.

Ren Zhengfei’s venture Huawei (pronounced Hoo-wah-way) began life by buying a phone switch called the PBX from Hong Kong and selling them into China.

Three decades later the company is the world’s second（，it is now the first）largest supplier of internet and telecoms infrastructure equipment, with major customers including BT and Vodafone.

A recent drive into smartphones has seen it accelerate to become the third largest seller behind Apple and Samsung – with its eyes set firmly on the crown.

In 2010, the first year it ventured into the market, it sold 3m phones. This year it had expected to ship 80m phones – before revising that to 90m. It set up a British office in 2001, four years before winning its first UK contract – a multi-million-pound deal with BT to help it roll out its 21st Century Network, the precursor to its superfast broadband.

As it expanded the group left downtown Shenzhen for its new campus, where staff are expected to log-in by 8.30am.

During their midday break, most make for one of the eight canteens on site. The size of aircraft carriers, each houses up to 5,000 hungry workers and offer dishes for as little as 12p.

The company’s motto, ‘to enrich people’s lives through communication’, is spouted by employees including Yi Chengcheng, the guide around an exhibition displaying Huawei’s technology, to Shao Yung, the deputy boss of its consumer gadget business.

Its research and development outfit is the most closely guarded part of the campus. Dubbed the White House by staff (to the annoyance of managers) because of its striking resemblance to the US President’s home, the R&D building bans all laptops and cameras. Phones can be taken in – but not used, and only if the serial number has been submitted more than 24 hours in advance.

In Huawei’s exhibition hall a guide outlines recent innovations. Turning old phone boxes into mini-masts to boost mobile network in dense urban areas is one.

Huawei’s in-office internet boosters are also shown off. Sleek, small and unobtrusive, they allow the company to place its wares unnoticed in almost any building.

Some 2,200 are in Beijing Airport. Another 800 are in German football team Borussia Dortmund’s stadium, with plans to install a similar number in Rangers’ Ibrox stadium in Glasgow.

But trust is an integral part of its relationship with customers, and the company has been forced to win that back around the globe after it was accused of allowing the Chinese state to use its systems to spy internationally.

In 2012 the US Senate issued a report that all but barred the group from any public sector work in America.

Huawei maintains no evidence of spying has emerged, and insists that former Red Army officer Ren Zhengfei’s company is independent from the state. But the political heat has not cleared, and could be the only thing that prevents Huawei achieving its ultimate goal of global dominance.


Read more: Huawei plots red reign: Chinese boss with plans for domination | This is Money
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[cirr]

Huawei looks to boost investment in IT infrastructure

DOW JONES
SEPTEMBER 17, 2014 9:30AM

After overtaking many Western rivals in the market for telecommunications gear, China's Huawei Technologies Co. is now setting its sights on another big market: servers and data centers.

Huawei aims to boost its revenue from its information-technology infrastructure business--consisting mainly of computer servers, storage and data center management--tenfold to US$10 billion in five years, the company's top executive said Tuesday in an interview.

In China, the company already counts such Internet firms as e-commerce giant Alibaba Group Holding Ltd. and major financial institutions among its customers for products and services related to data centers, which house key computer systems.

Globally, Huawei is still a relatively small player in the data center business dominated by Western competitors like International Business Machines Corp., Hewlett-Packard Co., Cisco Systems Inc. and EMC Corp.

"We will heavily invest in this area," Eric Xu, Huawei's acting chief executive, told The Wall Street Journal in an interview Tuesday.

Huawei boosted its investment in research and development for IT products and services by 20 per cent to US$600 million this year. Next year, it will spend even more, Mr. Xu said, declining to disclose the amount.

Huawei still has a long way to go because supplying servers and helping build data centers require different and broader sales channels compared with how it sells its telecom gear to carriers, analysts say.

IT infrastructure is a small but growing part of Huawei's business. Last year, Huawei generated about 70 per cent of its US$38.9 billion revenue from the telecom carrier network business. While IT products and services only accounted for less than 3%, the segment's revenue rose 60 per cent to US$1 billion, according to Huawei.

In the global data center market, "Huawei is starting from almost zero presence so there is a lot of room for growth," said Forrester Research analyst Bryan Wang. Huawei needs new engines for growth because the telecom equipment market is largely saturated, he said.

Still, Huawei could expand quickly by offering competitive products at lower prices, just like it has done in the telecom market, analysts say.

Mr. Xu said Huawei isn't using lower prices as a primary way to gain market share, but acknowledged that new customers who aren't yet familiar with Huawei's IT offerings often expect better deals.

Huawei is expanding its IT infrastructure business as U.S. competitors have faced challenges in China in part because government agencies and sensitive industries are turning to domestic suppliers, citing security risks of key technologies supplied by foreign companies.

Major banks such as the Bank of China, China Construction Bank and Agricultural Bank of China are using Huawei's servers and storage products in their data centers, according to Huawei.

Huawei sees a "huge market" in the financial-services sector in China--not just banks but insurance firms and brokerages, Mr. Xu said.

He declined to comment on whether government policies are giving Huawei advantages against Western rivals in China, and said Huawei wants China to be an open market.

"If China becomes a closed market, that would be a tragedy for Chinese companies," because lack of foreign competition makes them less motivated to keep improving their products, he said.

Huawei has also provided data-center equipment and services to Alibaba, which is expected to go public this week in the U.S. in an initial public offering that could raise as much as US$25 billion.

Beyond China, Huawei is trying to expand its data center and other IT businesses in Europe by teaming up with German business software company SAP SE.

In the U.S., Huawei has largely been shut out of the telecom networking gear market since a congressional report in 2012 recommended that U.S. carriers avoid equipment from the Chinese supplier out of national security concerns. Huawei denied the allegations.

"The door is still open" for Huawei's server and data center businesses in the U.S., Mr. Xu said.

"In the U.S., we are focusing on less sensitive industries" such as retail and education, said Raymond Lau, a Huawei IT infrastructure unit executive in charge of finding business partners. "The U.S. is never an easy market," he said.

Mr. Xu's interview was during Huawei's two-day cloud-computing conference--an annual event that began four years ago. Shanghai's Expo Center was packed with thousands of enterprise clients and business partners from about 80 countries.

No Cookies | dailytelegraph.com.au

 

[cirr]

Huawei set to tap financial demand

2014-09-17 08:53

Shanghai Daily Web Editor: Qin Dexing

Huawei Technologies Co will strengthen its cloud computing, big data and server business in the next decade to meet booming demand from Internet users in the financial and government sectors, its rotating Chief Executive Eric Xu said.

By 2025, the number of global connection devices will reach 100 billion including 8 billion smartphones, up from 1.7 billion phones in 2013. Driving the booming Internet demand will be industries and government which will replace demand from consumers in social and e-commerce, the company said at the Huawei Cloud Congress which opened yesterday in Shanghai.

"Huawei is ready to become a global leader on ICT (Information, communication and technology) through self-development and cooperating with partners," Xu told the conference attended by 12,000 people.

Huawei said it will provide IT services that converge mobile Internet and traditional services to China Pacific Insurance Co. Huawei has already offered services to China Merchants Bank and the Industrial and Commercial Bank of China. It has also offered technical support to the planned Shanghai-Hong Kong Stock Connect program.

Huawei aims to provide financial IT services to generate more revenue because finance requires storage, analysis and cloud computing applications for the huge volume of data, according to analysts.

 

[cirr]

Huawei predicts 100B connections by 2025, producing 175 zettabytes of data per year

September 16, 2014 | By Mike Dano

SHANGHAI--Huawei has added its voice to the growing chorus of companies predicting massive growth in the communications sector: The Chinese company said that, based on a new global survey of business executives, it now expects a total of 100 billion connections (both human and machine) by 2025, a figure that includes 8 billion smartphones. Huawei said that 90 percent of those connections would come from intelligent sensors. Interestingly, Huawei also said the United States is ranked second in--just behind Germany--in terms of which countries are best positioned to take advantage of the growth in the information and communications sector.

"We're still in the initial stage of full connectivity," said William Xu, a Huawei executive in charge of marketing, here at the company's cloud computing event. "It is our hope that the GCI will not only indicate ICT investment and development in various countries and industries but, more importantly, serve as a reference for industry policymakers and enterprise decision-makers."

Huawei's findings are part of the vendor's new "Global Connectivity Index," or GCI, which the company said is a "quantitative assessment of a country's efforts and achievements in the drive towards ubiquitous broadband."

The index is essentially the Chinese vendor's answer to the Ericsson (NASDAQ: ERIC) Mobility Report and Cisco's Visual Networking Index, both of which are widely cited by those in the telecommunications industry for growth figures. Specifically, Ericsson predicts that mobile data traffic between 2013 and 2019 will grow ten times, to close to 20 exabytes per month. And Cisco predicts 25 billion devices will be connected by 2015, and 50 billion by 2020. That Huawei is releasing its own index reflects its desire to continue to play in the same league as the world's largest telecom technology providers. Indeed, Huawei is already the world's second largest provider of network infrastructure and the world's third largest smartphone vendor.

Huawei's GCI is based on surveys of around 1,000 business executives--including those in agriculture, education, financial services, government and other industry segments--in 25 countries. The countries include Brazil, Canada, Chile, China, Egypt, France, Mexico, Germany, the United States and the UK, and represent 68 percent of the world's population.

In its survey, Huawei found that technologies including cloud computing, the Internet of Things and new wireless network technologies will help drive new connections. And the company said that those connections will result in new services and technologies: For example, the firm predicted "body-area networks" that will monitor patients' organs and health will lead to better healthcare. Separately, it predicted connected stadiums for sporting events will capture every element of the game, including players' viewpoints, for those on-site or watching remotely.

All of those connections will generate enormous amounts of data, Huawei predicted. The company said the average Internet user consumes about 16 GB per month, and in 2025 that number will more than triple to around 50 GB per month. The result, Huawei said, will be 176 zettabytes of data produced in 2025 globally, up from 3.8 zettabytes last year.

Huawei's GCI also evaluated specific countries and how they are positioned to take advantage in the growth of connections. The firm ranked Germany, the United States, the UK, Chile and Japan, in that order, as those countries best positioned for the coming growth. Huawei pointed out Chile as a relative surprise in the top-five list, explaining that the country is working to build "a complete digital ecosystem." Huawei said the country's government has invested around 0.9 percent of GDP into telecommunications, and its mean broadband download speed is 14 Mbps. Huawei also said that, on average, each consumer in Chile will download 60 percent more apps every year to 2018.

http://www.fiercewireless.com/story...ium=rss&utm_source=rss&utm_campaign=rss&flv=1

 

[DragonEmpire]

We need more well managed companies like this. Especially in the automotive industry.

 

[Beidou2020]

We need more well managed companies like this. Especially in the automotive industry.

There are a few issues with the automotive industry that prevents it from developing global Chinese brands.

1) the joint venture rule with foreign brands means Chinese brands can't dominate the low and medium end segment. So they never develop their brand from using the cost advantage and moving up the technology ladder.
2) most Chinese automotive companies are inefficient state-owned companies. Automobile industry is not a strategic industry so the state role must be eliminated like in the internet industry.

 

[Skull and Bones]

Huawei Ascend Mate 7 is impressive.

 

[Götterdämmerung]

In a wide-ranging interview, Shao Yang, vice-president of the company’s consumer marketing business, said business consumers would form a major part of tits strategy to become a serious player in smartphones.

With tits strategy, you can only win.

 

[terranMarine]

With tits strategy, you can only win.

tits

 

[Shishike]

Huawei indeed put a big cut of cake of income on research and tech development.

 

[cirr]

With tits strategy, you can only win.

I noticed the misspelling and thought I‘d better leave it at that for the sharp-eyed。

 

[PWFI]

Huawei is making state of the art smartphone, perhaps my next smartphone will be acend mate 7, and cost almost the cost of other best smartphones available here.

 

[cnleio]

HuaWei is a successful China 3C company.

 

[cirr]

Yue Wang Contributor

Opinions expressed by Forbes Contributors are their own.

FORBES ASIA 9/23/2014

A New Business Direction for China's Huawei

China’s Huawei Technologies knows how to compete. The telecoms equipment maker now commands 20% of the global market as it expands rapidly in Central Asia and Latin America. It is also becoming a threat to Samsung and Apple in the smartphone business. Huawei is now the third-largest smartphone maker in the world, as its market share rose to 6.9% in the second quarter from 4.3% a year earlier.

Now Huawei is looking to disrupt business in information technology. Last week, it spent $25 million to acquire UK based start-up Neul, which makes industrial sensors that can connect agricultural fields, pipelines, water pumps as well as other objects to a cloud service for monitoring of key indicators- for example pollutant levels, oil flow and water usage. Neul develops technologies to connect objects to the Internet – an idea also called the Internet of Things that the International Data Corporation forecasts will fuel a $7.1 trillion market by 2020, up from $1.9 trillion in 2013.

English: Huawei Technology in Shenzhen, China (Photo credit: Wikipedia)

The deal is Huawei’s first investment in IT after the company announced on Sept.16 that it would increase sales of computer servers, storage and data center management tenfold to $ 10 billion in five years. Last year such products brought in only $1 billion of Huawei’s total revenues of $ 39 billion.

Huawei didn’t reveal its future plans for Neul, which previously raised $ 18.8 million from Draper Fisher Jurveston, IQ Capital Partners and Cambridge Business Angels. In a statement to GIGAOM, Huawei said IoT is a “key direction” of the Internet and the acquisition means “improved access to the growing and exciting market in the IoT.”