Chinese smartphone maker Huawei has announced that it will compete with Amazon and Alibaba as a global provider of public cloud services.
The Shenzhen-based outfit said it will expand in cloud computing with a dedicated division that will recruit 2,000 more people this year.
President of the new unit, Zheng Yelai, said that Huawei used to focus on private cloud and did well.
“Now the purpose is to strengthen our public cloud offering.”
Consultancy Gartner expects the market for public cloud services to reach $383 billion by 2020 from $247 billion in this year.
Huawei hopes to continue developing software-based revenue at a time of slowing growth in smartphone sales and reduced spending on telecommunication infrastructure.
In China, its biggest rival is Alibaba Cloud, while the latest market entrant is conglomerate Dalian Wanda Group Co Ltd in partnership with Big Blue.
Huawei deputy chairman Eric Xu said the company’s global network of telecoms clients give the firm a unique advantage.
“I believe we can build upon our advantages accumulated over the years,” Xu said, referring to carrier partnerships in Europe and a strong presence in developing countries. Compete and coexist with AWS and Microsoft, I believe that is the trend we are going to see.” Xu said.
Xu also said Huawei would not compete for market share by offering services at extremely low prices.
“Our strategic focus will be on our telecom partners’ cloud transformation”, Xu said.
Britannic Technologies has snubbed traditional networking bigwigs and given a £1 million networking contract to Huawei.
The comms VAR is introducing software-defined infrastructure and networking across all its datacentres. The job went out to tender and Huawei cleaned the clock of Cisco and Juniper.
Britannic said that Cisco was knocked out earlier and the choice was between Juniper or Huawei. While Juniper is renowned in the carrier space, Huawei spends more on R&D, has a better roadmap and seems to know what it is doing for the next 15 years, Britannic said.
The contract includes a new optical backbone between datacentres, and an SDN-powered infrastructure across all the core.
Despite hacking off the Americans, Huawei is doing well. Its Enterprise Business Group saw 2015 revenues hike 44 per cent to $4.25 billion with 76 per cent of that generated by channels and partners. The Chinese firm now claims to have 300 distributors and VARs and a further 8,000 tier-two channel partners globally.
Britannic is a Gold reseller partner of Huawei and also a Platinum partner of Mitel and is a big name in cloud and managed services.
Former rubber boot maker Nokia has gained control of French counterpart Alcatel-Lucent following its $17 billion all-share offer and the two telecom equipment makers are planning to swiftly merge their operations.
Nokia wants to be in a stronger position to give Ericsson and Huawei a good kicking in the telecom network gear markets. To do that it has to absorb Alcatel-Lucent and restructure its channel rather fast.
Formal closure of the deal is not expected unti the first quarter of next year, but the restructuring will happen before that.
Nokia Chief Executive Rajeev Suri said that from January 14, 2016, Nokia and Alcatel-Lucent will offer a combined end-to-end portfolio of the scope and scale to meet the needs of our global customers.
The stock is still down about 10 percent since the announcement of the deal in April as investors have worried about the integration process and special terms negotiated by the French government.
But in October, Nokia brought forward the deal’s 900 million euro cost-saving target by a year to 2018.
The deal, set to become the biggest transaction in Finland’s corporate history, follows a string of M&A moves that have restructured former mobile phone giant Nokia in recent years.
In 2013, it took control of its network business by buying out Siemens from a joint venture, and in 2014 it sold the ailing mobile phone business to Microsoft. Last year it also sold navigation business.
Huawei’s UK and Ireland chief security officer told its UK and Ireland partner summit that it had no secrets from anyone.
David Francis admitted some partners’ customers might not be sure about the red flag outside Huawei’s headquarters but they should have confidence in the security of Huawei product and services.
Huawei gave up on the US market after it and fellow Chinese vendor ZTE were banned from bidding for US government contracts due to concerns over espionage. Some UK government departments were told to stop using Huawei’s videoconferencing systems in internal meetings.
Francis said that Huawei was committed to openness and collaboration and when it spoke about security, it need to differentiate between real security, which is based on facts, evidence and analysis, and the illusion of security, which is whatever you fancy talking about in the pub.
Francis claimed Huawei was the first company to publicly publish how it addresses cybersecurity.
He said that the company was committed to working collaboratively with the industry and sharing information with no secrets.
Despite being on a US spying list, China’s Huawei technologies continues to clean up.
Huawei does not have to tell us much, because it is a private company, but the world’s No.2 telecommunications equipment maker, reported a 33 percent rise in profit for 2014.
This matches company guidance, as the global adoption of fourth-generation (4G) mobile technology boosted sales.
Net profit for 2014 rose to $45.7 billion US dollars, the Shenzhen-based company told media in an earnings briefing today.
In a breakdown, its revenue from telecom operator business rose 16.4 percent year on year, to $31 billion dollars; its revenue from enterprise business reached $3.1 billion dollars, up 27.3 percent year on year; and its revenue from consumer business reached $12.1 billion dollars, up 32.6 percent year on year.
Meanwhile, the company invested $66 billion dollars in research and development, rising 29.4 percent year on year and representing 14.2 percent of its annual sales revenue.
In the past ten years, Huawei’s investment in research and development accumulated to $307 billion dollars.
Either way, despite the US’s most ironic embargo, Huawei is doing rather well.
A research company believes that Samsung will be the number one smartphone vendor in 2015, taking the lead over Apple.
Digitimes Research (DR) said the top 10 vendors this year will be Samsung, Apple, Lenovo, LG Electronics, Huawei, Xiaomi, Microsoft, TC, Coolpad and Oppo.
HTC, which only a few years ago was top of the smartphone pops, doesn’t appear to get a lookin at all. Last week, Cher Wang, chairman of HTC, took on the CEO duties too, displacing former CEO Peter Chou to head up a new products division at the Taiwanese firm.
DR estimates that Samsung will ship over 330 million units and Apple will manage to ship 230 million.
But Lenovo appears to be edging upwards in the smartphone league. This year it will ship 64 million units, while LG will ship 67 million units, just ahead of Huawei.
DR estimates that Android phones supplied by the top 10 Android smartphone vendors willl represent over 70 percent of the total units shipped this year.
Intel and Huawei Technologies are getting closer even as their rival governments fall out over trade blocks.
According to Huawei, the pair are getting closer and will share technology and adopt Huawei branding behind the bamboo curtain to make Intel products more palatable to local buyers and the Chinese government.
The technology involved focuses on the cloud, with the pair working on a project to create new servers, a data centre, software and cyber security for a global cloud-computing network.
China’s government has been openly pushing for the use of more Chinese and less foreign-made technology, both to grow its own tech sector and as a response to Edward Snowden’s leaks about widespread US cyber surveillance.
Intel and Huawei have collaborated previously, including a server and cloud product team-up in 2012 and an agreement to cooperate on data storage last April.
Although the announcement is mostly Chinese focused it is likely that the Intel side of the deal will result in other products seen worldwide. Intel would take the lead in nations where Huawei is not trusted, and Huawei stepping forward in countries which are worried about US surveillance.
Huawei is spending a bomb to improve its 5G patent portfolio.
The outfit said that it wants to spend $600 million on 5G wireless research and development from 2013 to 2018.
But speaking to reporters at the Mobile World Congress in Barcelona yesterday, Huawei Chief Executive Ken Hu said that 5G research spending was likely to rise, without giving specific figures.
Huawei was Europe’s seventh-largest patent filer in 2014, up from 13th the previous year, according a report published last week by the European Patent Office (EPO). It was granted 493 patents by the European agency in 2014, although they were not all 5G related.
5G is supposed to be the next big thing, promises superfast internet speeds, broader network coverage and peace in our lunchtime.
It is also expected to be the driver to hook up objects to the internet from cars to health monitoring devices or the internet of things. The commercial launch of 5G is expected to begin in 2020.
“We have made quite a large number of technology innovations and breakthroughs,” Hu, deputy chairman and ‘rotating’ chief executive of Huawei, said.
These give Huawei a stronger position in terms of intellectual property, he said.
Hu urged cooperation among telecom operators, equipment makers and other industries to agree on a single set of standards for 5G technology to ensure a global market.
In 2014, sales of smartphones to individuals reached 1.2 billion units worldwide, a rise of 28.4 percent compared to 2013.
Worldwide sales of smartphones in the fourth quarter of 2014 saw an increase of 29.9 percent compared to the same quarter in 2013, totalling 367.5 million units, according to Gartner.
And in the fourth quarter, Samsung lost its number one spot to Apple – as a result of product introductions in Apple’s case, and erosion of sales in Samsung’s case.
Samsung lost 10 percent in market share, according to Anshul Gupta, a Gartner analyst. “Samsung continues to struggle to control its falling smartphone share, which was at its highest in the third quarter of 2013. This downward trend shows that Samsung’s share of profitable premium smartphone users has come under significant pressure,” said Gupta.
For the whole year, Samsung remained the leader, shipping 307,597 units worldwide, while Apple shipped 191,426 phones.
The top five vendors in the fourth quarter were Apple, Samsung, Lenovo, Huawei and Xiaomi, according to Gartner. These last three vendors are all Chinese companies.
Chinese phone maker Huawei is planning a campaign to win over US consumers, rolling out new mobile phones and wearable devices backed by a marketing effort.
It is a brave move considering that it was only two years ago that the company was branded a spy by US senators who knew at the time that there stance was a case of the kettle calling the pot black.
China’s second-largest smartphone maker, already with more than $40 billion in annual revenue from a wide range of telecom gear and products, is preparing to introduce Americans to several of its smartphones and wearable devices this year, including its youth-oriented “Honor” phone.
Huawei’s US spokesman Bill Plummer said the company’s 2015 US plans will include traditional advertising, online promotion and sports team sponsorships.
He said the company wanted to change its marketing approach to shed its image as a purveyor of cheap technology products.
In December, it touted its new Honor 6 Plus phone on a billboard in New York’s Times Square. Plummer said that was “a sign of things to come”.
He declined to say how much Huawei will spend on its new marketing campaign or what sports team, or teams, it had in mind. In the UK it already sponsors Arsenal, cricket teams in India and rugby clubs in Australia.
At the Mobile World Congress over the weekend in Barcelona, Huawei took the wraps off a smartwatch that will be sold in over 20 countries including the US.
Huawei now intends to appeal directly to consumers with several new phone models, both low end and high end. It hopes to secure deals with carriers, selling online through marketplaces, such as the one operated by Amazon.com, and on its own fledgling gethuawei.com US direct-sales website.
US senators are mostly concerned with Huawei’s networking equipment, but in consumer land, Huawei has a huge problem with brand recognition.
A report said
Samsung faces increased competition from mainland China.
And that will affect Apple’s bottom line too, according to a survey by Taiwanese market research company Trendforce.
It published figures that showed that in 2014 home grown companies Huawei, Xiaomi and others managed to ship 453 million units – nearly 40 percent of total smartphone shipments worldwide.
Samsung is being squeezed by Apple as well as Chinese smartphone brands but Apple itself is showing signs of losing the brand loyalty it largely depends on.
The company predicts that during 2015 the Chinese branded smartphones will account for shipments of 531 million units. That will be a growth, year on year, of 17.2 percent.
But the Chinese brands showed a growth last year of 54.8 percent.
One of the reasons for the smaller growth is because Chinese telcos have been cutting subsidies, making handsets more expensive.
But that is also likely to affect Samsung and Apple too.
When Samsung released its financial results recently, it reported smaller profits on its smartphone devices in the face of increased competition from Apple and others.
Over 375.2 million
smartphones shipped during the fourth quarter of 2014 – that’s up by 28.2 percent compared to the same period the year before.
Apple had been the number two vendor in 11 previous quarters before Q4 2014, but, according to IDC, it was close to a tie with Samsung, the market leader.
IDC now predicts that Samsung could well outstrip Samsung during 2015.
It’s not just Apple that is challenging Samsung – as we’ve reported before, is under challenge from small Android OEMs selling products at much lower margins.
Growth in 2013 represented 40.5 percent but according to IDC, “the market clearly still has legs”. It estimates growth will fall to a mid teen figure during 2015.
The top five vendors for the fourth quarter were Samsung, Apple, Lenovo, Huawei and Xiaomi. The last showed growth of 178.6 percent during Q4 2014, compared to Q4 2013.
Apple and Samsung
were the biggest buyers of semiconductors in 2014.
Together, they bought $57.9 billion worth of chips last year, up by $3.9 billion in 2013, according to Gartner.
In terms of the total market for semiconductor, both companies’ accounted for 17 percent of the total market.
Gartner said the two firms have been top of the semiconductor consumption market for four years in a row.
That, said analyst Masatsune Yamajo, means decisions they make “have considerable technology and pricing implications for the whole semiconductor industry”.
Samsung was still top buyer but its decision to withdraw from some parts of the PC market as well as losing market share to other vendors meant its growth rate wasn’t as great as in the past.
Gartner estimates that the top 10 companies bought $125.6 billion of semiconductors, accounting for 36.4 percent of the whole market in 2014.
After Samsung and Apple, the remaining eight top ten buyers were HP, Lenovo, Dell, Sony, Huawei, Cisco, LG Electronics and Toshiba.
The entire semiconductor market worldwide amounted to $339.9 billions last year.
which is beginning to challenge smartphone players including Samsung and Apple, turned over close to $12 billion in 2014, according to its CEO.
Lei Jun, the CEO of the company, said the revenues rose 135 percent compared to 2013, in a blog on the company’s website.
The company isn’t public but that hasn’t stopped it denting sales of the global giants as well as having an impact on another Chinese manufacturer of telecommunications equipment, Huawei.
Lei claimed that Xiaomi shipped over 60 million phones in 2014, an increase of 227 percent compared to 2013.
But while Xiaomi might well be making waves and causing its competitors some alarm, it’s doing so using a model which doesn’t yield big profits. Estimates are that its margins are in the low single digits.
Although Xiaomi remains a private firm, it is receiving investment from a number of big names in Asia and Reuters claimed the market value of the company is as much as $45 billion.
Tawian’s watchdogs have cleared China’s Xiaomi and other smartphone brands of breaching data protection laws after national security concerns triggered a government probe.
The National Communications Commission said all the 12 brands it had tested, which also included handsets sold by Apple, Samsung, LG and Sony , did not violate the laws.
James Lou, an NCC official who was involved in the testing, said the commission, however, would request mobile phone makers make information transmission more secure.
The probe was started over concerns that the Chinese handset makers Huawei and ZTE were being used as snooping tools by the Chinese.
Taiwan is a bit sensitive to security matters involving China, which is its largest trading partner, but has never renounced the use of force to take back what it deems a renegade province.
Xiaomi, whose budget smartphones are popular throughout Asia, was previously accused of breaching data privacy. In August, the company said sorry and changed a default feature after a Finnish security company said Xiaomi collected address book data without users’ permission.
Taiwan’s government began performing independent tests on Xiaomi phones after media reports said that some models automatically send user data back to the firm’s servers in mainland China.
The probe was then widened to include local and foreign handsets. The NCC report said handsets made by HTC Corp, Asustek, Far EasTone, Taiwan Mobile and InFocus Corp, whose handsets are made by Taiwan’s Hon Hai Precision Industry were also cleared of breaching the data protection laws.