21Vianet 2600Hz 3Com 3GPP 3Leaf 4G 4G licensing 5G Africa Alcatel Shanghai Bell Alcatel-Lucent Alibaba Android antiitrust Apple APT Satellite Arete AT&T auction backbone Baidu Bain bandwidth base station Battery broadband cable CBN CCP censorship Cfius China China brands China FTTH China hi-tech China market China media China Mobile China Mobile Hong Kong China Science China Telecom China Unicom chips Ciena Cisco civil society CNNIC Communist Party convergence copyright CSL cybersecurity Datang drones Egypt Elop Ericsson EU Facebook FDD LTE FDD-LTE feature phones Fiberhome FLAG forecasts Foxconn FTZ Galaxy S3 Google GSMA GTI handset handsets Hisilicon HKBN HKIX HKT HKTV Hong Kong HTC Huawei Hugh Bradlow Hutchison India Infinera Innovation Intel internet investment iOS iPad iPad 2 iPhone IPv6 ITU Japan KDDI KT labour shortage Leadcore low-cost smartphone LTE MAC MAE Mandiant market access Mediatek Meego Miao Wei Microsoft MIIT mobile broadband mobile cloud mobile data mobile security mobile spam mobile TV mobile web Motorola music MVNO MWC national security NDRC New Postcom Nokia Nokia Siemens Nortel NSA NTT DoCoMo OTT Pacnet Panasonic patents PCCW piracy PLA politics Potevio price war private investment Project Loon Qualcomm quantum Reach regulation Reliance Communications Ren Zhengfei Renesys RIM roaming Samsung sanctions Scania Schindler security shanzhai Sharp SKT Skype smartphones Snowden software Sony Ericsson spectrum Spreadtrum standards startups subsea cables subsidies supply chain Symbian tablets Tata Communications TCL TD LTE TD-LTE TD-SCDMA Telstra Twitter urban environment USA US-China vendor financing Vitargent Vodafone New Zealand WAC WCIT Web 2.0 web freedom WeChat WhatsApp Wi-Fi Wikileaks Wimax Windows Mobile WIPO WTO Xi Guohua Xiaolingtong Xinjiang Xoom Youku YTL ZTE

Entries in China brands (1)


Huawei's brave new world

Huawei’s abandonment of the US market and the trimming of its enterprise sales forecast are the biggest news items out of its annual analyst event in Shenzhen Tuesday.

Yet in both case there is less than meets the eye.

Huawei is not going to win any major US network deals in the current Washington environment, so the remarks by executive VP Eric Xu merely reflect reality. And it certainly has a handset business there.

It might have cut the topline forecast for its new enterprise group, but it's still aiming for a hefty $10 billion in sales by 2017 – equivalent to three-quarters of ZTE’s total revenue last year.

For me, the biggest take-outs are twofold: Huawei’s diversification looks to be on track; but to succeed it has to go where almost no other B2B company has gone in creating a global brand.

On diversification: the enterprise business unit in its second year grew 26% in 2012 and has target growth of 45% this year. Assuming that growth remains profitable, the 2017 target looks achievable.

By that time the company hopes to reduce carrier equipment sales to just 60% of total revenue, compared with 73% last year, and increase handsets to 25% (22% for the past two years) and enterprise to 15% (5%).

On the brand: In a frank presentation, Shao Yang, Huawei's devices chief, said building the brand would be harder than developing the software and hardware. The Interbrand CEO told him there wasn't a single brand on the Interbrand 100 that was big in both B2B and B2C (IBM was the closest). And Huawei doesn’t have anything like Samsung’s $12.5 billion budget.

I’ll be posting more about Huawei here and at Light Reading in the next couple of days.