Huawei is on a different trajectory from other vendors.
After steamrolling its way through the global telecom industry, the Huawei Technologies Co. Ltd. juggernaut is re-aligning itself to take on the IT industry as well.
This week it has gathered 20,000 of its enterprise and carrier customers into a stadium in Shanghai to deliver its view on where the businesses are going.
It's not a complex message. The cloud is eating everything, according to Huawei. In what it describes as "Cloud 1.0," companies like Uber, Airbnb and Alibaba Group ambushed competitors through clever application of cloud technology. "Cloud 2.0" will be the industry cloud, in which dozens of verticals take advantage of the cloud's agility and lower cost. By 2025, 85% of all workloads will be executed in the cloud and all businesses will be cloud-enabled, Huawei predicts.
The company has got itself in front of this through a dedicated enterprise unit that last year -- less than five years after its creation -- reported $4 billion in revenue. It may have trimmed its forecast but even under its revised guidance the company is expected to grow at a compound annual rate of 35% between 2016 and 2018. (See Huawei Pushes Back $10B Enterprise Target to 2018.)
This is not a unit devoted to selling LANs and WANs in provincial China, of course. It's focused on the top end, and already has an A-list roster that includes HSBC, General Electric Co. (NYSE: GE), Mercedes Benz, CERN and Honeywell International Inc. (NYSE: HON). During the Shanghai event, HSBC's CIO and GE's head of global alliances appeared on the conference stage.
The history of IT and telecoms may be replete with tales of vendors that got it wrong, but Huawei's vision appears to make sense. The move to virtualize telecom networks and data centers on standard IT platforms is one aspect. The oncoming IoT juggernaut is another. And the cloud will tie this all together.
As far as Huawei is concerned, so will its product set. The implicit theme in Shanghai is the convergence of telecom and enterprise. The major product launch is a new unified SDN controller -- the first of its kind -- that can be deployed in telecom networks, campuses, data center WANs and IoT networks.
It's difficult to imagine any other comms vendor doing all of this, and kicking it off in such a large arena. Huawei is playing a different game, betting confidently on telecom-enterprise convergence plus the cloud.
The company has come a long way from its early days as a supplier of low-cost gear. Admittedly, it has had the help of state bank credits, but that alone can't explain its growth.
It has built a successful customer-focused and global culture. That doesn't guarantee success for its cloud gambit, but as a formula it's been hard to beat.
– Robert Clark, contributing editor, special to Light Reading