‘We Are Not the Best Now, But We Are Improving Fastest,’ President of Huawei's Cloud Unit Says

‘We Are Not the Best Now, But We Are Improving Fastest,’ President of Huawei's Cloud Unit Says

Li Na

Date: Tue, 09/12/2017 - 19:29 / source:Yicai
‘We Are Not the Best Now, But We Are Improving Fastest,’ President of Huawei's Cloud Unit Says
‘We Are Not the Best Now, But We Are Improving Fastest,’ President of Huawei's Cloud Unit Says

(Yicai Global) Sept. 12 -- Huawei Technologies Co.’s cloud business has been a hot topic since the company decided to consider it a level-one unit last month.

“I am just working on transparent cloud infrastructure,” said Zheng Yelai, president of Huawei’s cloud business unit, commenting on external skepticism about the group’s cloud business.

"We are not the best now, but we are improving fastest,” Zheng told Yicai Global.

Huawei is also ramping up investment in research and development. The firm said earlier that it hopes to invest USD500 million over the next five years to develop its services to help companies achieve cloud-based transformation and that 5 percent of its R&D investment will go towards advancing and governing security products and solutions.

“To the company, as a strategy of our cloud computing business, we must succeed in developing a public cloud,” Zheng. “To me, things that I do have not changed after the promotion of the level of our unit.”

Huawei’s cloud business mainly consists of two parts, and its cloud business unit and information technology arm are responsible for its public cloud and private cloud, respectively, said Zheng. All the cloud researchers are in its cloud business unit, which is responsible for designing the entire structure.

“Clients can choose to put some of their businesses on the private cloud and some on the public cloud,” Zheng said. “We leave the mission of developing a customer-focused mixed cloud solution to cloud computing and big data product lines affiliated to the IT product line. However, our cloud business unit is responsible for the consistency and unity of the entire structure.” Shifting from being a product supplier to a solution and service provider is a huge challenge for Huawei, and this is why Huawei has set up a cloud business unit, Zheng said.

For internet companies, making money with data is an important part of cloud services and it is also the starting point for business models. Huawei may need patience, as its cloud operations may not be raking in the dough right away.

“The cloud unit is set to be a slow business and may not be profitable in three to five years,” an employee at Huawei said.

“Huawei’s business logic is to make money from technology,” Zheng said. “We do not compete with you on apps and do not sell your data. I just work on transparent cloud infrastructure.” To Huawei, its cloud business is another sales model, so the company is not worried about profitability, Zheng said.

“Huawei invests in cloud computing. We invest from the bottom up rather than the top down. The final services provided by cloud computing consume resources of the entire network. Huawei used to deliver products to your home, but now we sell services to you. From chips to applications and from hardware to software, Huawei has overall ability.”

Huawei has pledged not to acquire client data by using technological means and will not make money from such data. Instead, it will work with clients to explore data's value by using its cloud computing and big data technologies. This is the biggest difference between Huawei and internet firms in terms of their cloud business models, said Guo Ping, the group’s interim chief executive.

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Keywords: HUAWEI, Business Strategy, cloud service