A brief introduction of today's huawei
Huawei Technologies Company is one of the largest telecommunications equipment makers in China. By the end of 2002, the company employed 18,000 and revenue was 22 billion yuan ($2.7 billion), down 15% from 2001 and significantly lower than the projection of 35 billion yuan ($4.2 billion) for the year. The decline was caused mainly by falling operator capital expenditure, intense competition, and mistakes in product development.
The company was established in 1988, during the peak of China's economic reform and technological advancement. From the very beginning, Huawei has spent heavily in developing new products, including switching, access, transmission and mobile communications, and has risen to one of the most competitive companies in the domestic market.
Huawei's major products include: central office: C&C08, iNET; transmission: OptiX high-end optical cross-connect series with throughput up to 1.6 terabit per second, DWDM system, multi-STM-16 (Metro-3000), multiservice platform (Metro-6100), flexible access (FA16); Quidway NetEngine high-end routers (80/40/16 series) and Quidway gigabit Ethernet (S8000/6500/5000 series); ATM switch, broadband switch and access systems; mobile communications: GSM900/1800, GPRS, CDMA 2000 1X EV-DO; wireless local loop (WLL): intelligent network and others. In 2002, Huawei established itself as a strong contender in MMS equipment, edge networking equipment and WLAN.
Since the 1990s, Huawei has spent about 10% of its revenue and 10,000 engineers on new product development, or 46.5% of its workforce. The main focus of research is on optical communications systems: SDH and DWDM; mobile: GSM, GPRS and 3G systems; broadband switching: multiservice exchanges; intelligent IP service nodes and others. Huawei has six research centers in major cities across China, including Beijing, Shanghai and Nanjing; the company also has research facilities in the US (Santa Clara and Dallas), Russia, India and Sweden.
Huawei has developed an extensive sales network in China and 40 overseas offices for its broad product offerings. Its switching products have been sold for nearly 60 million lines (cumulative) in all provinces. Huawei's broadband products are being used in 150 cities across China, Asia and South America. Huawei's Quidway NetEngine has become a strong contender in high-end router market, and has been sold in more than ten countries beside China. Huawei has sales in some 30 countries, including Russia, Thailand and Brazil; overseas sales rose $550 million in 2002, up 25% from 2001, in which mobilecom equipment accounted for $170 million, nearly double the number in 2001.
Huawei is one of the fastest growing telecom manufacturers in China and the largest private telecom company. However, beginning in 2002, the company began to feel the pressure in maintaining financial health dragged by heavy investment in R&D for a broad range of products and high cost of sales, while growth for its flagship products (CO and DWDM) sputtered as operators cut back capex substantially. Also in 2002, Huawei lost a major bid for CDMA2000 1X contract from Unicom and prematurely exited the PAS market. With a weak home market, Huawei has shifted its attention to international market, especially in Southeast Asia and Eastern Europe to boost sales, but long-term effect of the strategy remains to be seen. The company also may split part of its asset to be listed in Hong Kong and the US in 2003 for additional funding. During 2002, Huawei laid off 15% of its workforce, the highest in the company history.
