Reject Limits. Build the Future.
At the Huawei Global Analyst Summit (HAS) on April 16, 2019, David Wang, Huawei Executive Director of the Board, Chairman of Investment Review Board, and President of ICT Strategy & Marketing, delivered a keynote titled "Reject limits. Build the future". The speech script is as follows:
Ladies and gentlemen, analysts and media friends, good morning!
I'm very glad and honored to meet you here again.
We released our annual report two weeks ago. You may have noticed that we continue to invest heavily in R&D. Our R&D investment in 2018 totaled CNY101.5 billion, accounting for 14.1% of the company’s total revenue.. And we ranked No. 5 in the 2018 EU Industrial R&D Investment Scoreboard. You may wonder what kind of strategy selection and business logic is driving our heavy ongoing investment in R&D. I'll share with you the answer.
Innovation has become the core philosophy of Huawei R&D, and also a key factor of Huawei's ongoing growth. With customer needs in mind, we have worked with our customers and partners to create value for the entire industry and society over the past three decades, and developed into a leading global ICT infrastructure and smart device provider.
Today's ICT industry is hitting the ceiling. Further advancement in ICT is Mission Impossible, without theoretical and technological breakthroughs, as well as massive technology experience. To drive industry innovation and upgrading, we are committed to leading the industry from five aspects: Redefine the technical architecture, redefine the product architecture, lead the pace of industry development, set a new industry direction, and foster a new industry. Looking to the future, we believe humanity will enter an intelligent world where all things are connected. Connectivity, computing, and cloud are the underlying infrastructure of the intelligent world, and AI is the core driver that powers the intelligent world. Next, I will share some of the success stories about how we break the limits and build the future from connectivity, computing, cloud, and AI.
Delivering world's best connectivity: Redefining Moore's law and challenging the Shannon limit
Connectivity business is the foundation of Huawei. After 30 years of efforts, we have become a world leader in many areas. As we lead the industry towards a new era where everything is connected, we are committed to delivering the world's best connectivity. During the 50 years when the ICT industry was developing rapidly, we continued to innovate based on theories such as Moore's law, Shannon theorem, and the von Neumann architecture. As chips are moving quickly into the sub-nanometer age, Moore's law will expire soon. Meanwhile, the current coding algorithms are reaching the Shannon limit. This means the ICT industry is hitting the ceiling.
Extending the Shannon limit for mobile 5G is developing faster than we expected. But what you may not know is that, the communications rate of single links is reaching the Shannon limit. Without fundamental innovations, 5G performance cannot truly improve. To meet these challenges, Huawei has actively explored with the industry and introduced Massive MIMO to extend the Shannon limit. We have made forward-looking and intensive investment in Massive MIMO, and innovated to lead technological breakthroughs.
Although Moore's law has almost expired in the chip domain, Huawei redefines it in the IP network and optical transmission domains.
Doubling IP network performance every 18 months: In the IP network domain, we are challenging the limits of superfast interconnect and doubling IP network performance every 18 months. Huawei IP products and solutions were industry's first to provide 400G per slot in 2012, and helped address three industry pain points: high-density 400G superfast handshaking, large-capacity power supply, and efficient cooling. Over the past seven years, Huawei's IP switches increased the switching capacity per slot from 1T to 19.2T. Our goal is to increase that number to 38.4T by 2022.
Doubling fiber capacity every 36 months: In the optical transmission domain, we are also challenging the limits of fiber capacity. We built industry-leading supernucleus transmission sites, which ensure fiber capacity can double every 36 months in the ultra-broadband era. Huawei's OptiXtreme DSP chip H6 provides the industry's first 600G per wavelength, and up to 120 wavelength on C-band.
Redefining computing architecture for more computing power, more affordable
As the intelligent world approaches, there will a stronger demand for computing power, and computing patters will need to be more diversified. The key challenges that the computing industry is facing are a lack of compute and expensive compute. To address these challenges, Huawei's core strategy is to redefine the computing architecture to make computing power more accessible, more affordable. We embrace the heterogeneous computing demands brought by diversified data and applications, and advance the computing architecture from X86 and GPU to a combination of X86, GPU, ARM, and NPU. We are also innovating and optimizing servers, storage, and networks to systematically boost computing efficiency.
Leading diversified computing using core chips: Huawei launched Ascend chips and Kunpeng chips in 2018 Q3 and 2019 Q1, respectively. We have introduced AI management and intelligent acceleration capabilities to X86 servers, becoming the industry's first to bring intelligence to traditional servers. We launched FushionServer Pro in Beijing two week ago, and also the highest-performance TaiShan servers using the ARM64 chip, bringing computing performance to a new high level. Based on Ascend chips, we launched the Atlas AI computing platform right here one week ago. This marks the first AI platform with synergies between the edge, device, and cloud.
Maximizing storage performance with medium & architecture innovation: Storage performance directly decides the efficiency of computing power input and output. This means the improvement of storage performance will help maximize computing power. Huawei uses self-developed solid-state drives to replace hard disk drives, offering a 100-fold increase in performance over traditional drives and over 50% higher performance than its peers. In terms of interfaces, we use multi-protocol interface chips to remove the burden of CPUs on network protocols and reduce latency by over 10%. By using the ARM server as the controller, the new architecture improves power efficiency of storage processors by more than 30%.
Industry's first data center (DC) network with zero packet loss to ensure 100% computing power: Another key factor for computing power is the DC network, a factor which we used to ignore. Most DC networks today are built on traditional Ethernet, which is subject to packet and computing power loss due to congestion. Through technological innovations, Huawei built the first DC network with zero packet loss to ensure 100% computing power. This was achieved by embedding AI chips into DC switches and developing the iLossLess intelligent lossless algorithm.
Building the best hybrid cloud for industry digitization
In 2017, Huawei announced that we are to become one of the world's five clouds. Over the past two years, we worked with our partners and developers to build the best hybrid cloud to help industries go digital. As the industry moves towards the Cloud 2.0 era, governments and enterprises will play a major role in cloudification. Hybrid clouds will dominate the Cloud 2.0 era to serve the needs of agile development, on-demand flexibility, and security and compliance. Therefore, our core strategy and goal is to build the best hybrid cloud. In 2018, we restructured and optimized our ICT infrastructure business, combing public cloud, private cloud, AI, big data, computing, storage, and IoT teams into Cloud & AI Products & Services. In 2019 Q1, we continued to integrate IoT and private cloud teams into Cloud BU. All we did was to implement the Cloud Only strategy and create more value for our customers and industries. To make HUAWEI CLOUD different, we mobilized resources from chips to data centers, from hardware to software, from IT infrastructure to cloud services, and from edge computing to cloud computing. Our goal is to make HUAWEI CLOUD the industry's only cloud with full-stack capabilities, the best cloud for governments and enterprises, and the most intelligent cloud.
The most cost-effective cloud: HUAWEI CLOUD is the industry's only cloud service provider with full-stack capabilities. Thanks to this, we can optimize the full stack from data center infrastructure and chips, to hardware and basic cloud services. We can also conduct innovations across layers to boost computing density. Huawei is innovating both hardware and software to achieve optimal performance. For example, with bare metal servers and InfiniBand, our AI model training is more than 25% faster than peers. And we also boast the industry's most powerful full-stack container services and micro-service framework ServiceStage.
The best hybrid cloud: Huawei hybrid cloud solutions are the best in terms of both market performance and product service capabilities. We have served over 350 government clouds and over 200 financial clouds. These practices will help us build the best hybrid cloud for governments and enterprises to go digital. HUAWEI CLOUD offers industry-leading unified architecture, operations & maintenance (O&M), upgrading, APIs, and ecosystems. This offers customers consistent online and offline experiences, as well as online development and offline deployment. For example, the Shaanxi Provincial Department of Finance deployed Huawei's hybrid cloud, which quickly enabled online development testing and offline deployment. This has helped the department tap into the affordability of public clouds and use private clouds to secure data.
The most intelligent cloud: As the industry becomes digital and intelligent, AI has become the focus of cloud service competition. Leveraging Huawei's full-stack, all-scenario AI solutions and innovations, HUAWEI CLOUD will surely become the most intelligent cloud. First, Ascend chips offer the greatest density in a single chip, and ARM64 chips have the highest power efficiency. These chips will help build full-stack AI capabilities and make computing power more accessible, more affordable. Secondly, the ModelArts one-stop development platform is fast to use, to train, and to launch. Last but not least, HUAWEI CLOUD has explored AI applications in over 10 industries and 200 projects. These practices will further optimize HUAWEI CLOUD and AI products and solution, and sharpen our AI competitive edges.
HUAWEI CLOUD stands on Huawei's shoulders: We are focusing all our efforts on HUAWEI CLOUD. To do this, we are integrating our 30 years of ICT technologies, capabilities, experience, and ecosystems regarding IoT, enterprise communications, video surveillance, and software development into HUAWEI CLOUD. This allows HUAWEI CLOUD to quickly bring together IoT, security, AI, and other industry application partners from around the world, and provide diverse consulting services and technology solutions for government and industry customers. Standing on the shoulders of Huawei, HUAWEI CLOUD is fostering a unique ecosystem with synergies between chips, devices, pipes, and the cloud. Our ultimate aim is to deliver high-quality services for our customers and create bigger value.
Full-stack, all-scenario AI for pervasive intelligence
Huawei is activating intelligence across devices, connectivity, computing, and cloud. As a general-purpose technology, AI will trigger an industrial revolution involving all industries, organizations, and people. At the HUAWEI CONNECT 2018, Huawei Rotating Chairman Eric Xu launched industry-leading full-stack, all-scenario AI solutions, aiming to make intelligence pervasive. So far, we have launched the Atlas AI platform and HUAWEI CLOUD AI services using Ascend chips, and the CANN operator development tool has supported hundreds of operators. We will soon conduct open beta test on the MindSpore training and inference framework. The ModelArt one-stop development platform is achieving increasingly higher performance and has launched the AI Market to help developers monetize their AI models. All of these show that Huawei's full-stack, all-scenario AI solutions are being implemented in all aspects.
Devices + AI: A better experience with smart applications: HiAI is a platform that opens AI capabilities to intelligent devices. It opens chipset, application, and service capabilities, allowing our customers to quickly utilize Huawei's strong AI processing capabilities and foster an open smart ecosystem to deliver a better user experience with smart applications.
Connectivity + AI: Towards autonomous driving networks: We launched the SoftCOM AI solution last year. This solution features unified training on the cloud, management across various domains and layers, and intelligent network units. This will help build the next-generation O&M architecture, and ultimately achieve autonomous driving telecom networks.
We plan to achieve level-3 conditional autonomous networks in three years, level-4 highly autonomous networks in five years, and level-5 full autonomous networks in ten years.
Computing + AI: Pervasive intelligence: The Atlas computing platform launched a week ago includes series products such as acceleration modules, accelerator cards, AI edge stations, and mobile data centers. This will bring AI to all scenarios on the device, edge, and cloud, and provide affordable and reliable AI for enterprises.
HUAWEI CLOUD + AI: A new engine of industry upgrading: By activating intelligence, HUAWEI CLOUD offers full-stack AI solutions, including basic platforms, universal APIs, advanced APIs, and pre-integrated solutions. As of April 2019, HUAWEI CLOUD has offered 59 services and 159 functions to enable industry upgrading by focusing on three scenarios: repetitive, high-volume work, expert experience, and multi-domain collaboration.
The key to AI development is working with partners and developers to foster a unique AI ecosystem with device-cloud synergy. Last year, we launched the Huawei Developer Program and Shining-Star Program, providing support in terms of resources, platforms, course enablement, and joint solutions. In doing so, we are committed to becoming the fertile soil to grow partner applications. We will continue to leverage the synergies between connectivity, computing, and cloud, and use full-stack, all-scenario AI solutions to lead the development of the ICT industry and power the intelligent world. Looking to the future, we will invest more in R&D, and strive for a leading position in the long term. We invest in the future, not just the present; we seek a stronger industry, not just business success; and we reject limits to build a fully connected, intelligent world with all our partners.
At the HUAWEI CONNECT 2019, you will see more heavyweight all-scenario AI solutions and industry applications. We look forward to seeing you in Shanghai!
Thank you for your listening! I wish you a pleasant stay in Shenzhen.