Blog post

Huawei’s cloud computing ambitions

By Lydia Leong | April 29, 2011 | 3 Comments


I was recently in China, visiting Gartner clients and prospects in Beijing and Shanghai, and attending Huawei’s analyst summit.

Why Huawei? I am an analyst covering services, after all, not equipment. But the hardware and software vendors that enable the cloud — the entirety of the ecosystem, so to speak — has become more and more important to my coverage, particularly as service providers try to figure out what technology they should use in their cloud. And so, when Huawei extended an invitation to come hear about their plans in cloud computing, I agreed to go fly halfway around the world to listen.

For those of you who are not acquainted with Huawei, they’re a roughly $23B networking equipment manufacturer — the largest supplier of telecom operator gear in the world, having recently suprassed Ericsson for that position.

At their analyst summit, Huawei announced a number of grand ambitions — to become one of the major global device manufacturers (Huawei’s phones and tablets are based on Android), to aggressively grow into the enterprise networking equipment business, and to become an all-in-one solutions provider for cloud computing. That includes Huawei’s product portfolio of modular and container-based data center solutions, servers, storage (via the Huawei-Symantec JV), data center and wide-area networking equipment, and the “cloud stack” of software needed to offer cloud IaaS, whether for an enterprise building a private cloud, or a service provider building a highly scalable public cloud. It also includes a suite of content delivery network (CDN) enablement solutions, targeted at network operators, and integrated into the cloud offering.

This is obviously a grandly ambitious plan, considering that it comes from a vendor that most non-carriers have never heard of, and which faces considerable prejudice in the United Sates. (Huawei recently got into a kerfuffle over its acquisition of the assets of 3Leaf Systems — the US government recently recommended rejecting their buying the patent portfolio and hiring some people out of a defunct Silicon Valley start-up with no customers to speak of, on national security grounds, a ridiculous tempest in a teapot if there ever was one.)

Huawei will join HP, IBM, Dell, and the VCE coalition, among others, in competing to deliver turnkey cloud infrastructure solutions. The product portfolio they claim to have, and the product portfolio they’re developing, are all highly ambitious and R&D-driven, although I believe that the technical problems that Huawei is tackling are genuinely difficult and therefore due caution needs to be exercised, as there is no proof that Huawei’s cloud technology scales as claimed.

Huawei will also face a significant barrier in the United States, given the political climate and suspicions about Huawei’s ties to the Chinese government, particularly the military and state security apparatus. This gets us back to the demand of cloud customers to know the underlying components of their solutions. If a service provider chooses to build on Huawei’s technology, will customers trust the solution?

Still, it’s an interesting entry into the cloud-building market from what to me, at least, was an unexpected quarter, and Huawei will clearly be a company to watch going forward — they have a track record of aggressive revenue growth, and plenty of money to throw at R&D.

Comments are closed


  • stentor says:

    “Prejudice”? Did a certain clannishness help in your selection of that word, despite the fact that Huawei has a massive credit line from a land that makes snooping on communications SOP, or that any assertions about so many very sophisticated and continuing intrusions into western government and industrial networks originating from Chinese servers being merely the work of 13 year old hackers or disgruntled Bulgarians and Russians stretches credibility to the limit? Or that hiring white lobbyists to tell congress, “just trust Huawei, your suspicions are ridiculous, groundless, without merit (or any othe favorite tagline from ChinaDaily)”, is laughably insulting to their intelligence. No, I think “suspicion” would be the proper word in all cases.

  • Lydia Leong says:

    “Clannishness”? That’s an interesting word to use. Do you assume that because of the color of my skin, I should somehow be more sympathetic to Huawei? (Side note: I’m an American. This trip was actually my first time ever in China, and the first time I’ve visited Asia at all in nearly three decades.)

    Note that I did use the word “suspicions” later in my post. But I’ll note that the attitude towards made-in-China technology is quite different in Europe than it is in the United States, for instance — Huawei gear powers a substantial percentage of the European mobile networks. (Huawei claims that more than 80% of all European mobile calls go through Huawei gear at some point. I don’t know how accurate a statistic that is.)

    Huawei has done some transparency-assurance things for their customers — for BT, for instance, my understanding is that they have some form of deal that allows BT to compile the source code themselves.

  • Galit says:

    Interesting post. Huawei is a major player in the technology area, and it’s fascinating to follow their attempts to stay relevant and leaders.