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|14th May 2012, 10:14||#1|
Join Date: May 2010
Huawei gunning for the Cisco kid
Huawei has been talking up its new enterprise unit which it claims will give market leaders Cisco a real Chinese burn.
Huawei announced its first US distribution agreement with IT distributor Synnex that will allow it to expand its presence in the US enterprise market
It is also launching new products that compete with Cisco's telepresence offerings and network switches.
According to Reuters, the company has told its enterprise unit that it has to make $15 billion worldwide in revenue by 2015. In the few months that the department has been open it has made more than $7 billion worldwide and expects to invest $4.5 billion in research and development.
The enterprise unit is selling hubs, routers and switches that run networks transferring data across corporations.
According to John Roese, the US market is complex market and as tricky as an American company trying to elbow its way into China.
Fortunately the US is not critical to Huawei's cunning plan and there are signs that what ever the company is doing is working.
Huawei's enterprise unit revenue rose 57.1 percent in 2011 to 9.16 $1.45 billion, making it the fastest growing division though it contributes only 4.5 percent of total revenue.
Roese is certain that Huawei has what it takes to be a formidable rival to Cisco in the United States.
He said that there has not been alegitimate major competitor for Cisco for a long time, but Huawei was not a small player.
Cisco's Chief Executive John Chambers has named Huawei as its toughest rival.
So far this has only extended to some patent trollage from Cisco, which saw Huawei remove the contested parts.
However, we can expect to see some more patent cases between the two as the gloves come off.
Huawei also has some problems in that US politicians, keen to earn campaign funds from US tech companies, have been claiming that the outfit is a communist plot.
Huawei has a secretive founder Ren Zhengfei who is a former Chinese military officer. There are also concerns that its hardware might phone home secret data to China.
This has shut Huawei out of the US federal government and the financial services market. So far.
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