Business Transformation

Huawei's New Acting CEO Key to Global Expansion

Huawei has announced that Ken Hu, currently the Chinese vendor's deputy chairman, will replace Guo Ping as acting CEO under the company's "rotating CEO" system.

Introduced in 2011, the system means that Huawei Technologies Co. Ltd. acquires a new leader every six months. Ken Hu will take over from Guo Ping on April 1 and remain in the CEO post until September 30.

Besides being deputy chairman, Ken Hu is also the chairman of Huawei USA and head of the company's global cyber security committee. In a statement, the Chinese company described him as "integral to the strategic direction of the company and instrumental to Huawei's efforts to expand its business in the global markets."

Huawei has been growing rapidly outside China -- flagging overall sales growth of 35%, to 390 billion Chinese yuan ($60.4 billion), last year -- but has been locked out of opportunities in the US since the country's authorities labeled Chinese network equipment makers a security risk in 2012. (See Curing America's China Syndrome .)

The appointment of Ken Hu, with his international experience, may be aimed partly at trying to overcome US concerns about Huawei's technology.

Despite the implicit ban, Huawei's equipment is still being used in the network of Sprint Corp. (NYSE: S), as revealed by Light Reading earlier this year. Huawei has also made inroads into the US market through sales to rural carriers. (See Surprise! Sprint Still Has Huawei in Its Network and Huawei Working Hard for Rural Success.)

As previously reported by Light Reading, Huawei may be gearing up for US business in anticipation of a change in administration early next year, with industry insiders suggesting a Hillary Clinton presidency might look to heal the rift that has developed during the Obama years. (See Are Huawei & ZTE About to Feel a Thaw in the Comms Cold War?)

Huawei has continued to recruit US staff in the past few years and currently employs about 700 people at an R&D center in Silicon Valley.

Rival ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763) has also suffered as a result of US prohibitions and was recently hit with an export ban after being accused of violating sanctions imposed on Iran. The export ban was temporarily lifted earlier this month following what the US Commerce Department described as "constructive" negotiations with ZTE. (See US Lifts ZTE Export Ban – Report and ZTE: What On Earth Were They Thinking?)

— Iain Morris, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, News Editor, Light Reading

mendyk 3/31/2016 | 2:43:42 PM
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