Telcos should be optimistic for growth, but only if they embrace change, according to Huawei.
“2017 may be a year of uncertainty,” said Mr. Zhilei Zou, President of the company’s Carrier Business Group while talking at a pre-MWC event in London this week, “but some carriers see an opportunity of growth. As long you seize this opportunity, you will see growth.”
While Zou acknowledged various challenges – especially currency fluctuations – could make for a difficult year, the company was positive about helping telcos grow, if they are willing to embrace change.
“In terms of how the telecom industry stands, many people ask me what the future looks like and whether we are near to hitting a ceiling,” he said. “We actually believe that this industry is much broader than our imagination has so far allowed.”
Cloud, Digital Transformation, Video, and 5G were key factors to fuel this growth. Opportunities of the future include ubiquitous connectivity, 100% cloud adoption among enterprises, more than 40 billion connected devices, plus real-time intelligence such as robots or digital assistants. But in the short term Huawei emphasised there were still more than 3 billion people without any internet, more than 2 billion without mobile service, and over a billion without access to broadband.
Zou put a lot of emphasis on research and Huawei’s own transformation away from its white box past – the company is now spending 15% of its revenue - more than $8 billion a year - on its R&D efforts.
“In the past, Huawei was a follower, we made a lot of boxes,” said Zou. “By only selling boxes, we will not be able to solve the problems of carriers.”
The company is launching seven Cloud-based products for Telcos at this year’s Mobile World Congress to help carriers make their own transition to the Cloud.
“Video is king”
Continuing the theme from last year’s Ultra Broadband Forum, there was a strong emphasis on video as an opportunity for telcos.
10 years ago, coverage was king and the main attraction for customers, then it was bandwidth, but in today’s world, video is the most valuable proposition and one that could be “the next trillion-dollar opportunity" for service providers, said Mr. Ken Wang, President of Global Marketing and Sales. “More than 60% of traffic is video. Video must become the next basic service from telcos.”
That opportunity is likely only to get larger, especially in the B2B space. Video for entertainment and communication are already large industries, said Wang, but emerging video-driven areas such as online education, health, smart cities, and smart transportation are “huge opportunities.”
Despite the company being one of the main drivers for 5G, the technology took a back seat to Huawei’s focus on Cloud.
It was however, highlighted as a major part of the future. According to Dr. Yuefeng Zhou, CMO of the company’s Wireless Network Product Line, Huawei expects to have its first commercial 5G products out by 2018, and promises that the massive improvement in service 5G offers “isn’t a dream, it’s real.”
More than 60 companies across the world have already started introducing 5G technology into current networks (so-called “4.5G” technology, or, as Nokia announced this week, 4.9G), something which Zhou described as a “real business opportunity” for carriers. He said that while the network architecture will have to change to fully accommodate the new technology – Wang warned “simply having a 5G base station is not enough” – it is already possible to develop and deploy 5G oriented services without waiting until 5G networks are ready.
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