During his keynote at an Analyst Summit in Shenzhen last week, Huawei’s Rotating CEO Eric Xu spoke about the company’s focus on Cloud & 5G, and why Artificial Intelligence doesn’t need to be a product line all of its own.
Mr Xu took part in a press & analyst Q&A after his keynote where he spoke further about the company’s plans in the US, its Public Cloud strategy, and why he isn’t a fan of smartwatches.
On the company's US strategy:
For the United States, no matter whether it's the Telco, enterprise, or the smartphone businesses, our strategy there remains unchanged.
For the Telco business, the US is not a high priority market for Huawei. For the enterprise business, we'll grow that business step by step. For smart devices, US is not a high priority market for now, but in the long term is going to be.
On competing with Amazon and Azure in the public Cloud space:
Both AWS and Microsoft enjoy very strong advantages in the United States and in other developed markets.
In developing markets, I believe that will be an area where Huawei enjoys an advantage because we have an expansive presence and we have very strong capabilities in those markets. Therefore, we can use the advantages we have accrued over the years and compete while coexisting with both AWS and Microsoft.
On going into competition with IT Services companies:
Our competitors are not IT service companies. Quite the contrary, those companies are Huawei's partners because Huawei's positioned ourselves in this non-telco enterprise market as a provider of products. We work together with our partners to engage with and serve the end customers.
On AI and its use within Huawei:
AI will be everywhere in our products, in our technologies, and in our operations. And I believe AI can bring value in each and every one of those aspects.
In the Telco markets, we've been talking about the technology of AI to build what we call a network brain. The whole notion of this network brain is to help telecom operators to be more intelligent as they build, run, and manage their network.
Also, we have tried to bring artificial intelligence into smartphones. Last year we launched Huawei Magic; a concept phone with AI capabilities built into it. The idea was to show how the phones would evolve from smartphones to intelligent phones.
And then our network and cloud service - no matter whether it's Public Cloud or Private Cloud - we also inject the capabilities of AI into the Cloud platform to better enable enterprises.
And we are even thinking about using Artificial Intelligence for the design of base stations. Today's base stations are too complicated; there are so many algorithms to cater for different types of scenarios. We are wondering why we cannot use Artificial Intelligence for the design of base stations to make it less complicated.
On future devices and wearable tech:
Nobody can say for sure that smart devices in the future will continue to be smartphones. We don't yet know what's the form factor of future smart devices and how they look. Probably it is just a glass.
As for the market potential for smart watches, I am not a man who wears watches myself and I've never been optimistic about this market. When the smartwatch team within Huawei presents their ideas to myself with a lot of passion and excitement, I keep reminding them whether there will be a tangible need in the market.
I have never been able to figure out since people have smartphones, why smart watches?
On telcos & Huawei's digital transformation challenges:
The key is to take action. it's not about discussion. Huawei is facing exactly the same challenges as telco customers. We must digitalise our own operation first because that's the foundation for us to talk with and drive digital transformation of our customers, and that's the only way for us to showcase how digital transformation will look like after it's done.
On whether 5G will see the rise of new vendors:
Personally, I don't believe that in light of so much complexity around mobile communications technologies and the need to build different technologies into one base station that we are going to see new players coming out in this domain.
One thing that is quite unique within the mobile communications market is that the competitiveness of suppliers or vendors sometimes does not necessarily come from your expertise on the latest technology, but quite often on your past experiences and past expertise on older technologies.
For telcos, what they need is 2G, 3G, 4G, and 5G into one base station. If vendors can only have the ability to offer standalone 4G or standalone 5G, that cannot meet the needs of the telecom operators and that will drive up the costs for site acquisition.
That means, for any new potential vendor, to try to use 5G as the entry point to establish a position as a vendor without a strong competitiveness and without a strong presence in 3G and 4G, that will be very difficult.
Of course, that does not mean vendors that do have those past experience and advantages can sleep on their past laurels because we have seen so many many examples in the past where companies vanish just resting on their past laurels.
On going public:
We have never had such discussions within the company.
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