Huawei’s strategies for enterprise IT biz focus on TCO, to take on Cisco

Infotech Lead Asia: Huawei announced its business strategy for gaining market share in the IT for enterprise domain.

As per the five-year strategy, it will focus on global enterprise ecosystem in coming months. Huawei will try to bring IT solutions which can bring down total cost of ownership (TCO) for enterprises.

Many enterprises already benefited from Huawei’s’ customer-centric operations, ICT product and solution portfolio and full life-cycle services, reducing TCO by over 20 percent.

Since TCO will become the prime focus, Cisco, Huawei’s main rival in the U.S. and global markets, will be under pressure.

Cisco’s global revenue increased 5 percent to $12.1 billion in its fiscal second quarter ended on January 26. Cisco’s income rose 6.2 percent to $2.7 billion during the period. Its revenue from Europe, Middle East, Africa, and Russia region declined 6 percent. Europe is still a challenging market for Cisco. Main growth drivers include datacenter, wireless, video and services. Cisco’s product revenue grew 3 percent.

Despite challenges, Huawei is trying to build its enterprise business in the U.S., a strong market for companies such as Cisco, HP, Juniper, IBM, etc. Huawei Technologies has recently lowered its enterprise biz revenue target to $10 billion by 2017.

In 2012, Huawei’s Enterprise revenue increased 25.8 percent to 11.5 billion yuan.

Huawei Enterprise’s sales revenue is expected to reach $2.7 billion in 2013, substantially lower than Cisco’s recent quarter revenue of $12.1 billion. But enterprise business is an important aspect for the Chinese telecom major as it faces problems in the U.S. telecom equipment market due to security issues.

“With significant growth capacity, the enterprise market is a core element of Huawei’s overall strategic development plans. The Convergence of ICT has brought about great opportunities for Huawei to contribute to the evolution of this market,” said William Xu, CEO of Huawei Enterprise Business Group.

Adopting a win-win partnership strategy to address the operational challenges faced by many businesses, Huawei engages in ongoing collaboration with channel partners to deliver quality products, solutions and services to customers.

As of 2012, Huawei has established partnerships with more than 3,500 channel partners; this number is expected to reach 5,400 by the end of 2013.

Interestingly, Huawei does not talk anything new in this 5-year strategy plan.

Related News

Latest News

Latest News