Wednesday, April 18, 2012

Huawei, locally to internationally

Shenzhen-based Huawei Technologies shot past Alcatel-Lucent and Nokia Siemens in 2009 to become the world’s No.2 telecom-equipment provider, powered by quality and product upgrades on top of its long-standing low prices. In 2008, Huawei won a slew of lucrative, prestigious contracts and beat out rivals Ericsson and Nokia Siemens for a deal to build Norway’s pioneering 4G cell-phone network, one of the world’s first – and showed continued strength in the burgeoning Indian and Chinese markets. The sum of these deals was good enough to double Huawei’s global market share to 20%.

Even though Huawei fell from Rank 5(2010) of the most innovative companies in the world to 14th (2010), it still went ahead of Cisco (41th). Huawei Technologies leads the market in LTE (long-term evolution), the newest mobile-network standard, and it’s working on “100G” technology to wirelessly transmit massive amounts of data at ultra-high speeds. 46% of Huawei’s employees are engaged in R&D activities and Huawei invests an average of 10% of annual revenues into R&D. The research and innovation drove Huawei to become the world’s second-largest telecom-equipment suppliers. The newest mobile-network standard created a “blue ocean” market for Huawei among the existing competitors. Now Huawei would like to raise its brand recognition by introducing an affordable smartphone that hopefully will democratize the newest technology. With the increasing demand of the smart phones and more user-friendly experience, the newest networking standard will bring Huawei to the spotlight internationally, far beyond its current geographic focus – China, India and Latin America.

Huawei is trying to expand its business network around the world. It was a little difficult for Huawei to enter the American market, which is home to Cisco. Huawei tried to launch a channel program in 2011 for US-based partners to serve both the United States and Canada in the near-term. Huawei’s international growth brought it to the attention of the whole industry globally and its first presence in the Untied States through this program posed a great and long-term threat to Cisco. Huawei’s strategies of low-price and innovation are its advantages, leading it just behind Ericsson to tablets and smartphones. How could Cisco guard its territory within the United States seemed an interesting topic to the public but a serious topic to Cisco.

(1) Fastcompany.com
(2) http://www.crn.com/news/networking/231700273/huawei-to-challenge-cisco-with-bold-u-s-enterprise-channel-push.htm;jsessionid=JPOAHP-r8dQKlH98+eJnWQ**.ecappj01(3) Huawei Corporate Fact Sheet

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