UCStrategies Catches Up With Huawei

UCStrategies Catches Up With Huawei

By Blair Pleasant October 29, 2014 Leave a Comment
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UCStrategies Catches Up With Huawei by Blair Pleasant

In this Industry Buzz podcast, the UCStrategies Experts welcome a guest from Huawei, Edwin Diender, CTO of Western Europe. Blair Pleasant moderates the conversation, and is joined by Phil Edholm, Evan Kirstel, Art Rosenberg, Don Van Doren, Michael Finneran, and Jon Arnold. Topics include Huawei's offerings in the UC space, the company's differentiable values from a UC perspective, what Huawei is seeing globally in terms of cloud-delivered UC, and their plans for the North American market.

 

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Transcript for UCStrategies Catches Up With Huawei

Blair Pleasant: Hi, this is Blair Pleasant. I'm joined today by my UCStrategies colleagues for a very interesting podcast. For today's podcast, we have a special guest, Edwin Diender. Edwin is the CTO of Western Europe for Huawei. Over the past few years, Huawei has been active in the UC market, but I have not been tracking them as closely as I'd like, so today is an opportunity for all of us to become more familiar with the company what they're doing in the UC space. So welcome, Edwin.

Edwin Diender: Thank you for having me.

Blair Pleasant: Thank you. So let's start off by having you tell us about Huawei and your UC offerings.

Edwin Diender: My pleasure. Once again, thank you for having me. Most people probably don't know Huawei, so let me start off by saying that we're one of the largest information and communication equipment technology manufacturers in the world. We're supporting almost three-fourths or 75 percent of the global network providers and cable operators with systems and equipment to support their services including their UC&C offerings.

I represent the Huawei Enterprise Business Group, which has been founded somewhere close to the end of 2011, early 2012. All of the systems and services that have been derived from our carrier network's business and developments have been localized and tailored towards the enterprise market supporting as ME and small office/home office, all the way up the Fortune 500.

My responsibility is mainly on the UC&C solutions stack, which is comprised of four domains. We have a unified communications application that sits on top of an IP telephony system, which is one part. We have an IP-based contact center, which is the second part. The third one would be a video system with different endpoints, codecs and video infrastructure equipment for video conferencing and telepresence solutions.  We are reusing that same video system with other types of cameras like outdoor cameras, infrared cameras or motion-detection cameras. Our video system that we're using for video conferencing and for telepresence becomes an intelligent video surveillance solution. These four domains combined are what unified communications and collaboration solutions are to Huawei.

Blair Pleasant: Okay, and I know that when we talked last time, you mentioned innovation, and that you've done a lot of innovative things in this area with lots of patents. Can you talk about that?

Edwin Diender: Sure. What most people don't know is that from a development and research point of view Huawei has been known to provide the most patents also on a global scale. And a significant part of those patents actually relate to the UC&C solution stack. As an example, specific codecs, signaling,   protocols and compression technologies are commonly used worldwide have derived from patents from Huawei. The same goes for parts in specific web development and connectivity between a mobile device, a fixed device, and a telephony or communication platform that needs to switch between one and the other.

We're a global innovation company, as we say, and as we call it. That's also the part that we take high up  in our attitude and in our DNA. It is the innovation for us that drives our solution going forward, and is a part of our solution stack when we talk to customers. Specific customers have specific requirements. They really appreciate and value the fact that the R&D teams of Huawei are actually reachable, nearby so to speak, and are able to deliver upon customer development and customer requirements within a lead time of six to eight weeks. A solution stack that is not  yet existing , but which we discussed today,  we've developed tomorrow, produced the day after, and delivered the next week.

Blair Pleasant: Okay, great. I'm going to turn it over to some of my UCStrategies colleagues to ask some questions. Phil, let's start with you. What would you like to ask about Huawei?

Phil Edholm: I think one of the questions that people would ask in the UC space and you've talked about is innovation. The first would be from a customer perspective, what makes Huawei unique? What are the differentiable values that you think are important for people to consider in the Huawei solution from a UC perspective?

Edwin Diender: To answer that I think that we should cover two or three items, which together and combined make a UC offering. One would be the collaboration part where people and teams would sit together or have to work together regardless of their location or regardless of the device of their choice and share information and move forward. For that part, usually you would need a specific type of partner that needs to be able to understand what it is and what it takes to connect and to deploy.

Secondly, you would need to have a strong network or a converged infrastructure, if you like, that's capable of carrying these kinds of integrated services, like audio, video and data combined with IM, chat, and presence with what have you.

The third part would be that you would need to have a specific device that is also capable of connecting in different ways for the purpose that you want to use it for. When you compare Huawei to others, you would find that in all of these areas Huawei has a strong footprint. We have the infrastructure components coming from our own solution stack. We have a virtualization stack to make it more flexible and to virtualize. We have a unified communications application that can run on a mobile device, on a fixed device, on a PC workstation or on a laptop. We have the connectivity part that comes out of our experiences as an e-carrier network to make sure that if you're logging on via a wireless device, or a mobile device, or on a fixed device, that the network then sits in between, coming from, deployed with, or serviced by a cable operator or a telco and is able to optimize the connection going forward. Those three items are all sitting in the Huawei technology and in the Huawei solutions stack. The Huawei solution stack is an end-to-end solution that covers the three domains.

Phil Edholm: Okay, so basically, the thing that you can encapsulate there is that the value is kind of a complete integration, a broad portfolio, and working together?

My second question is actually related to something that we see as a continual challenge right now in the industry. A significant percentage and I don't know if it is as true in Asia and in Europe as it is in the U.S., but in the U.S. especially, a significant percentage of the enterprises are deciding to use Microsoft Lync for some percentage of their UC. Is Lync something that you interoperate with? Do you have a strategy for working with them together or how do you see that going forward?

Edwin Diender: In our view, Lync is a PC workplace-driven productivity tool that requires at some point, some enterprise communications enablement. There are a couple of ways of doing that. One of the ways would be that you would need a converged infrastructure, and maybe the Huawei partner would provide that. You would have an IT infrastructure partner that looks at datacenter services, and you would have a PC workplace owner, or an outsourced company that takes that.

From that side of the equation what we'd be looking at is, if you want to use Microsoft Lync on your PC workplace, then use it. If you want to use a smart device like, a Huawei tablet that runs the Lync client, be our guest. If you're looking for voice enablement, or if you're looking at communication enablement or a strong communication feature stack, which doesn't or is not proficient out of the Microsoft Lync environment, you can add an application from Huawei or an IP telephony system from Huawei to function with those features and work with that. That's one part of the equation that we’re looking at.  

In other sides of the equation -- we have people especially in Europe – we have  a number of those who are pretty…what's the word here…they have their own mind or they have a mind of their own, and maybe they appeal to the story of Lync, but don't really feel strong about moving forward with Microsoft on this. But they understand the message. They see the need for it; they look for an alternative, but have to do this similarly. In that case, Huawei can provide a similar desktop productivity tool, which is a UC application from Huawei, which is more or less equivalent to Lync. Slightly more intuitive because, regardless of the device, even the screen on your IP phone would have the same look and feel and the same way of working as the PC client or as your IP phone screen or as your PC-workplace client or your Smartphone or your tablet client.

Within the world of Microsoft Lync, we see some differentiation in there. Currently the tablet version of Lync isn't really the exact copy of what you can find on your PC workplace. It takes a while to get your head around it, so to speak. So yes, we are integrating, we are supporting, we are enhancing a bit, and in some cases were customers really don’t want to move forward on the Microsoft solutions stack, we can provide similar, but then it would be a Huawei solution.

Phil Edholm: Super. Thank you very much for that, Edwin. I'll throw you back with Blair. Thanks.

Blair Pleasant: Okay, thanks. I think that one thing we are all interested is hearing more about the cloud. Evan, I believe you had a specific question about the cloud?

Evan Kirstel: Yes, I'd appreciate your thoughts on what we see, which is the early phases of customers looking at moving real-time communications and real-time collaboration to cloud-based platforms and services? There are tremendous opportunities that customers see to reduce OPEX and networking spends and in some cases CAPEX, by moving to cloud-based offers. I'm wondering what Huawei sees globally as what is early days but clearly the writing is on the wall as far as unified communications delivered through clouds? Whatever you could share would be of interest.

Edwin Diender:  Sure. Thanks for asking this. As I mentioned in my introduction, we have a strong background in our carrier networks and from our carrier networks division. When you look at global networks from the telcos and the carriers at this moment in time, most of their networks are pretty much cloud-enabled already. It's not just because they chose to, it’s also because there is some sort of a technology push. As Huawei serves the majority of those telcos and carriers worldwide, you can imagine a predominate amount of that technology push came forth out of the Huawei carrier networks teams.

When you look at the enterprise business group’s portfolio on UC&C, and other parts in our portfolio, like the routing and switching part or the virtualization stack as we have it, or the datacenter solutions that we can provide. All of our solutions in the enterprise business group have derived from our carrier networks division. Which means that every item in our portfolio, as small as it is or as big as it is can be, already is cloud-enabled. It means it can run anywhere, any place, either private or public cloud. But the moment the partner or a customer starts working with Huawei, they have again an option of choice; to go forward with pushing everything into the cloud and taking it from there or using it more in a gradual approach or taking it from a private situation first and then move forward. Of course, there's a huge benefit of moving things into the cloud, especially from the IT management side of the equation. From a cloud-enabled point of view, you can imagine but I'm sure I don't need to reiterate what the benefits of the cloud are; but it's easier to manage, it's easier to maintain, it's easier to deploy. You don't need to have a roaming engineering workforce that needs to go customer onsite each and every time when there is an issue going on. So there is a benefit in cloud, but there's also a hesitation on the customer's side for cloud because of maybe privacy issues or some sort of hesitation in terms of, “I put my data and my databases somewhere else, not in my hands, not in my sight.” But, we have specific solutions for that in terms of migrating them and also from a training point of view to help them understand and to get more aware of it.

From a feature and functionality point of view what we don't have compared to others yet, is having our own datacenters where our systems and services are being built up to make use of white label of via OEM or ODM or by connecting it to our resellers and to our partners in a resale model towards the customers.

We're looking into these kinds of things because we get more and more questions from our partners and our customers saying -- “you've got a huge portfolio, it’s probably too big for me to get my head around anyway. But if you had a datacenter, push your services into that datacenter and I will take it as a service.” We're looking into that and probably by the end of this year or early next year, we're going to do the first proof of concepts and pilots with it, but we don't have it yet. What we do have is a strong portfolio, as I mentioned before, which is already capable of being deployed and run as a cloud or in a cloud employment. Does that make any sense?

Evan Kirstel: Okay, well great! Oh yes, that was very helpful, very insightful. Thanks for sharing timelines. It's always good to know, so Blair thanks very much.

Blair Pleasant: Okay thanks. Art, I think that you had sort of a follow-up question and you wanted to know about mobile in the cloud.

Art Rosenberg: Yes. Obviously, mobility needs the flexibility of cloud accessibility. So the fact that you, at least, are ready for the cloud, number one, and the fact that you are in bed with a lot of the carriers who supply both the endpoint devices and also increasingly the mobile apps that consumers will have and also organizations can use in the cloud. I just would like your perspective of how you would be implementing self-service applications in the cloud, mobile apps, if you will, that are UC enabled. In other words, somebody is using an online application and now they need assistance. Instead of placing a separate phone call to a call center, they click for assistance using something like WebRTC. So one, who is going to be developing, what tools do you have for developing those kinds of applications and how will they be offered to the public at large and under whose label?

Edwin Diender: We believe strongly in ecosystems and partnerships, strategic alliances and the lot like that and that is how we proceed. In our IP contact center domain, if you want, where social interaction and front-office and back-office integration are key areas in that specific line of thinking and line of business, if you like, we find these items coming back off and on. Where a voice agent or an email agent now should be able to work and support someone who goes into a web portal of city hall because they need to apply for a Visa or they need to get their passport going on, or maybe they need a contract for something like to rebuild or refurbish your house or something like that. There are web services already in place and with the right mouse-click, you can chat with an agent, but the agent is not really yet ready to take over the screen and support you and tell you – “I see that your mouse is circling and hovering over a certain button here. I will support you and take over your screen…”

We're getting more and more of those questions from our customers coming in already and we've deployed solutions that are supporting this. We are not a developing a company that is going to develop the apps for that. What we provide is a software development kit that talks with an API in our platform, and it will enable our partners to move forward, enrich and enhance the existing desktop client that we would have for an agent as such or web portal that needs to be contact center-enabled, if you like, or communication enabled. So that is one part.

The other part would be where WebRTC comes in, as you mentioned. We're applying WebRTC already in our UC&C solution stack but not yet in our contact centers suite. We have a roadmap for  WebRTC because there still seems to be a lot of discussion around whether WebRTC should be a standard, a standard of a global kind or a regional or maybe even a local kind. Huawei is a strong contributor into most of the industry bodies that discuss these kinds of standards. Since the outcome of these sessions in these industry meetings still don't provide a clear picture on whether it should be a global standard or not. Huawei is considering it as if it is a global standard. It doesn't mean that we're stopping it or that we're blocking it. We're applying it, and we're using it for video communications and chat in this case and for most of our browser functions.

So if you would use a Huawei UC solution application, you would log onto a web portal and you go to www.whathaveyou.com. Once you have logged in you are you are already in the browser via WebRTC. This enables video and chat functions that are not yet heavily deployed as a standard.,   Were working at putting all this into place.  

The social integration that sits on the contact center point provides a strong partner base and an ecosystem of app developers, customized developers who support us through  a default client that we already provide using an SDK and an API.

Art Rosenberg: Do you see that the wireless carriers will be white labeling everything that you provide them and that they will be the frontend for reselling the services?

Edwin Diender: From a carrier point of view seeing two things. In the past couple of years, we have seen a huge migration in convergence going on in the public networks. IMS would be a comment to make upon, IP-based multimedia subsystem. It means that you do not have different systems that work together as one for subscribers, but it means that the systems and services themselves are also integrated and converged in the public infrastructure. That has been done and that has been ongoing for the past let's say two and a half, three or maybe four years.

Currently, those networks are doing that and are billed and designed as such. The architecture has been put in place like that. We're now three and half – or four years later from that and we get a number of carriers and telco operators who are coming back and saying, “Why don't we find an agreement where we're outsourcing the solution that we bought from you four years ago back to you guys, and we are now in sourcing the things as a service?” The moment that is in place and the moment that takes place, which would be the moment that indeed a mobile operator would white label further versus what they don't do today, but they have a thought on it, if that makes any sense.

Art Rosenberg: Yes, I just wanted to see the direction of where things are going. Thank you for the answer. Yes.

Blair Pleasant: Okay, thanks. So Edwin mentioned several times that Huawei is a global company. Don, I think that you wanted build on that and ask a question related to that?

Don Van Doren: Yes, thanks Blair.  Clearly Huawei is making great strides, but hasn't been doing much in North America so far. Can you talk at all about what your plans are to become more visible in this part of the world?

Edwin Diender: Sure. My pleasure, even, because there have been a number of items published in the press about Huawei backing off or not having the attention for or not even looking at America or North America.

As I mentioned in my introduction, Huawei is a huge company, 150,000 people worldwide, and we're covering a number of strategic business units. One of those business units is our consumer devices unit. That is where our smart phones our tablets, Wi-Fi repeaters, etc. for home or for individuals are being produced. As far as I understand our Huawei mobile phone P7 - P6, our Huawei Mate, our “phablet” as we call it, which is a blend between a table and a phone, is available in North America. So, from a consumer devices point of view, we have a global footprint, number three in the world right under Apple and under Samsung. As far as I understand, our consumer devices are available in North America. So on that part we're visible, or maybe not visible enough, but we're present in North America.

From a carrier networks division, we're not, for a number of reasons that we don't need to reiterate here. But on the carrier networks side of the equation within Huawei, we don't have any affiliation with North America.

For the enterprise business group, we have been establishing the enterprise business group, end of 2011, early 2012. We say that we did it globally, but actually we can say we did it regionally. In North America as far as I understand, we started end of last year looking into some distributors in some states or in some regions. And with those distributors we found a couple of partners in some rural areas or cities, if you like. With some of them we have already done some deployments, specifically on our converged infrastructure side of the equation and on our multimedia conferencing part. As an example early this year with our partner ASI, we closed a video conference and multimedia conferencing project of the act4.net in the USA. And at a later stage, we more or less did the same and that is with the New York Empire State University. So that’s on the conferencing and converged infrastructure part of the equation.

What we do when we go forward and what we do when we establish a business practice, we usually take one part of our portfolio and enter as an example, routing/switching for networking. Once we have a footprint in that and we have a customer base for that the second year or 18 months later, we re-enter saying, “now you have a converged infrastructure; let's talk about UC enabling of some services.”

In this case, it's the other way around. We entered with a converged infrastructure and some multimedia conferencing part. You can bet that within six months after successful deployment, we will re-enter in the cases I just mentioned, and we will ask: “what about Wi-Fi, what about mobile, what about your connectivity, what about your additional collaboration need?” So we're starting small, but we could do better in terms of awareness and brand recognition, that's for sure. We're not fully out in the U.S.; it's not off of our radar. It's just not visible and on the top of our thinking in every strategic business unit that we have.

Don Van Doren: Thanks, very much I appreciate it.

Blair Pleasant: Yes, I think that that cleared things up that we were all wondering about. Michael you're up next. What's your question for Edwin?

Michael Finneran: Thank you, Blair. Well first, Edwin, thanks for taking the time to bring us up-to-date on what's going on with Huawei. Our focus as a group is primarily on North America, hence Don's question. But I'm interested in your global view; in the U.S. we see UC currently as entering the early mainstream. That's also the tact that Gartner is taking and frankly it took a while to divorce the idea of UC from the idea of telephony. But how do you see a real UC uptake occurring now both in Europe and in AsiaPac?

Edwin Diender: That's a very interesting question because there are a number of angles that you can take to answer it and to look at it – to give your mind a push and then get forward-looking statements and visionary ideas on top of that. When we're looking at realistic deployments, taking China or Asia Pacific into concern, you can imagine that it is a really, really, huge region to get them transformed in a big form of acceleration and with big paces going forward. That takes an amount of effort. The guys in Asia Pacific are taking those steps. It goes by falling down and stepping up again. The same for the take on UC.

The difference between having an analog or a TDM PBX versus having an IP PBX, versus having an IP telephony system, versus having an IP-based communications platform, versus moving into the area of unified communications, and then later into added collaboration we're not translating UC&C back to unified communications and collaboration.. We're saying that the way that people work together, share information, regardless of their location, regardless of the device that they use; the collaboration part is far more important than the fact that maybe sometimes someone needs to communicate with or about something as well. So UC&C to Huawei today is already user collaboration and communication. This is echoing very well in Asia Pacific.

In the speed of process and from a technology push in the sequence that I just mentioned you can imagine, people are always wondering where it is going, what's next? Why does it go so fast? Let's put a break on it. Speaking directly to people, Chinese guys in this case, and letting them understand what it is to have the tool that helps you work more efficiently, share information, and yes, you can also pick up a phone and have a call with it -- that resonates really well. So from a deployment point of view, and from a good messaging and market and then copy-pasting that back and translating that from China or Asia-Pacific back to localizing it in Europe, giving it a German feed or giving it a U.K. or a French or Spanish twist if you'd like -- or a Netherlands…whatever. User collaboration and communication also echoes here very well. In the Netherlands as an example, unified communications is considered the technical way of deploying the new way of work. That is not about technology at all. That’s not about boxes and systems and services and things that are being disconnected. The one part sits on the PC workplace and then you have a disconnect and the other part sits on the IP telephony part or on the telephony network. Does it make sense if I put it like that?

Michael Finneran: Yes, indeed it does.

Edwin Diender: Okay, so from a messaging going forward and from a deployment and putting things in place, we now see that because we're translating it slightly different, and we're giving them opportunities and insights into how that works with big banks out of China, or huge hospitals out of Germany, as an example. We see that in other regions and in other countries, people are picking up and saying, “Okay so that's the right direction. I'm not looking for a technical way of filling or living up to the expectations of a concept,” which as an example, Gartner calls out and says, “It's a new way to work. It's the high-performance workplace. We have communication-enabled business processes and technology that should live up to that or plug into that or tie into that.” We're taking it just the other way around. We're looking at people, teams, and departments, the way that they work together, how to improve that and how to apply this and then a service that supports it. How to optimize the connection and then take it from there. That's UC, but then the other way around and that's we go forward with it. That resonates and echoes very well, better we feel.

Michael Finneran: Interesting. Thank you very much. Blair, back to you.

Blair Pleasant: Okay, thanks. John we haven't heard from you yet. Is there something that you'd like to ask Edwin?

Jon Arnold: Thanks, Blair. Sure. Hi, Edwin and I’m really enjoying this conversation. I hope that you are getting a nice mix of perspectives here, since we’re kind of across the whole spectrum of UC. The thing that I would like to ask to add on this is, how do you see the enterprise opportunity as distinct from the S&B market. And do you have a sense of a roadmap that you could share with us for how you look at those two segments, presuming you are aiming for both?

Edwin Diender: Well actually, we aim across the whole spectrum, so also small office and home office, for that matter. The one, two-people companies, where one is a technical consultant and the other is a management consultant versus the big Fortune 500s and everything in between. We have systems and services that support that. The difference between one and the other in the analogy as you just put it, what we see is that below the mid-end of the market all the way down to the SME, small-office, home-office part…  the question for more and more services on a subscription-based way forward or on a monthly fee kind of way forward is what we’re seeing the most in that part of the market. That is slightly disrupting our thinking and our business model, to be honest, because we are not only the owner of a product line, but we're also the owner of a production line, right? We're manufacturing things. If things are going forward in terms of people don't buy anything anymore, they just want to get it for a monthly fee, and whoever can provision that, that's the one. That's what we see in the SME market going on.

In the enterprise we see the same line of thinking, but then not from a deployment of view, but from an operational excellence point of view. The IT team needs to improve stuff or the chief financial officer says it's costing me too much and it's sitting in my financial books and I want to get it out. I want it moved from CAPEX to OPEX. At some point we're deploying in a similar way, but not via an external party who can source it in or provision it, but we're moving to the datacenter of a large enterprise. We're going into their campus environment, if you like. We take the biggest building and we're deploying a datacenter there. And from that biggest building on that campus, we're provisioning things as a service to users in the other buildings on the same campus.

Those are the two sides of equation that you see evolving and developing. The part of mobile becomes more and more eminent and the predominate part of the need to move forward with UC. Then not having to be connected to a physical desk from 8-5 because my workplace is just not that fixed any more. The bring-your-own-device kind of thing, which is very much connected to the thinking of cloud as we discussed earlier, but also from a hosted and a monthly fee point of view, where the operator comes in and the app developers are sitting in mobile-device management and security, information security has a place.

Those are parts that are coming up more and more that require us as a manufacturer to provide differences in the services that supports it either on premise localized and you buy it and you would deploy it versus you can get it for a monthly fee. Our systems and services by the way support it all. People really have a choice.

Jon Arnold: So if I could just add one more question to that Edwin. As you stated earlier, you're not really a major datacenter player or at least at this point. And yes, you are primarily a manufacturer still. I'd like to ask you then…trying to cover all of the bases here…do you feel that the partnerships with services providers who really have that datacenter capability, will they be a better partner for you going after the SME space as opposed to enterprise? Or do you see them kind of being of equal value to you across all types of customers? This is clearly a shift from products and services. It puts the service provider in a very different light from where they fit in the scheme of things for UC.

Edwin Diender: That's true and that's spot-on. We see things involving and developing exactly in the direction that you just mentioned. Maybe not in every region as fast as we want, or maybe not in every country as prominent or eminent as we would like, but it is going that direction. On the other hand, it's not always necessarily the ISP that provisions this. I can give you an example from Germany, as well as from Belgium, as well as from the Netherlands, where in fact a cable operator who is providing triple-play and quadruple-play services to someone at home who happens to be the chief information officer of a big company as well, making him think… “What I got from my cable operator in a triple play or quadruple play service at home, why don't I take that to my office?” Hence the question to the cable operator, “What do you do in enterprise?” Some cable operators are saying, “We're not doing anything in enterprise.” Other cable operators, specifically in Europe, under the umbrella Liberty Global... I'm sure that you guys are following that sequence in this like a UPC or our region -- Ziggo or Tele2. Those are companies that are now providing an enterprise offering as an uplift from their consumer triple play/quadruple play offering. That's not an ISP, that's a cable operator just enhancing services.

We see that happening more and more, rather than the ISPs saying, “I'm a service provider. I already did something, and I'm just adding services to the datacenter systems that I already have in place.” So it's a bit of both actually. It's not really disruptive. We have datacenter solutions that are being deployed in the ISP, because they need high-level computing power,   a strong storage system, a virtualization stack which is capable of handling things just slightly better than the Hyper-V or the VMware-side of the equation. And then, they choose for some migration and talk Huawei, and they say, “You’re experienced with public networks -- why don't you transfer that to private networks into my postal code area or into my datacenter for that region, city, campus or hospital?” That is what we see in our business.

Jon Arnold: Okay thanks. Edwin, one more thing on the global theme that a few of us have touched here. I want to come back to the carrier environment for a second. I'm probably the only one on the call here based in Canada. I'm probably the only person in this group and maybe in the whole analyst community in North America who's seen firsthand what Huawei is doing up here in Canada with UC. I've met with your team up here and toured the facilities. It's very impressive what you guys are doing, and I just wanted to comment a bit about when I mentioned earlier about the carrier relationship. So I know that Huawei has had some pretty good success here selling infrastructure into the carriers up here, both in the mobile space and the spectrum option and getting new players in the game and of course with the incumbents. I suppose there must be a pretty good bigger-picture opportunity for you to be looking at with the combination of the network gear selling into the carriers and of course, partnering with M4 hosted services and pipeline into the enterprise customer base. I just want to ask, the kind of path that you are taking in Canada to establish that presence; you talk about wanting to build up your U.S. presence. Can we look to that as an indication of a path that you might follow for the U.S. market in terms of building partnerships?

Edwin Diender: Projects and project delivery drive not only interest, but also the acceleration of a strategy that either is put in place or should be put in place. North America is not my market. It's not my region, so I can only say from a general point of view. In my experience and in my view, as I mentioned before, the moment that we find the right partnerships and we see that a project base is increasing, there is more and more interesting coming about. There's more awareness around us. Those are usually indicators internally that we're using to determine to say a bigger “yes” to the “yes” that we already gave to the strategy going forward, or to change the “no” for a strategy into a “yes” now it's time to do, or now it's time to move on, and now it's time to accelerate. So again, not looking at your region specifically because that's not my region, but from where I'm I standing at a distance, I can see significant success going forward in the North American Region. My expectation would be that we take it as we do in other regions where we create success and where we replicate success. So I would guess so that yes, we would be lifting off on this and we would try to pursue to create a bigger footprint in the North American Region in one way or other, yes because it's just replicating success and it would be crazy to back off of that. Back away from that is a better way of putting it.

Jon Arnold: Okay, thank you.

Blair Pleasant: I think that Don did have one follow up question. Don?

Don Van Doren: I would just like to build on some of the questions that others have asked. Actually, my partner Marty Parker had a question that he'd wanted to raise. Let me build on that. Basically, as Michael mentioned, we're sort of in the early mainstream phase according to what Gartner see as the UC market. Many vendors have already established both a track record and a strategy to gain market share. Talk to us a little bit more just about how Huawei is going to primarily go after this market. Do you intend to primarily sell UC capabilities on top of your existing networking customers? Or are you going to introduce innovations and bring them to market as new kinds of features or different approaches or different kinds of packaging, which frankly will require more in terms of a distribution network and distributors who can build some of these value-added services into the offering? Which is the primary direction as you see it?

Edwin Diender: The primary direction is the one and the two and in the same order. I'm sorry. That is a convenient answer, but that is not what I want to get across. What I mean by that is that we always take things one-step at a time. It's more convenient for us to start branching off and building out on a footprint that we're good at, that we understand, and that we've done before. That also internally has a strong baseline from attention, from revenue, from interest, from contribution margin, etc., etc. That is coming forth out of the carrier network's experience on IP networking, so you converge the infrastructure. So when we proceed, as we go along and as we move up, yes, we have no choice than to take the first step on the network side of the equation first and then take the second by adding services. At one point, we would take it two steps further to prove things up to a level where we want to be eventually. That is where we will start using our innovation power to provide solutions, disruptive business models, feature stacks, packages and what have you, which are new either to us or to the market, or both, and which are capable of addressing new product-market combinations that we haven't seen before; the so-called “blue oceans.”

To Huawei as a Chinese company by origin, you can imagine that the principle and the concept of a blue ocean strategy is rather new. We're just slightly beyond the process of operational excellence, so we're getting there. It's not there yet. But we're moving forward and we're moving fast. We're taking huge steps and this is also part of that wave of moving forward.

So yes, as I said we currently have no choice than to take it one-step at a time and to start with the networking side of the equation first. We're one of the strongest companies in the world that provides a better and stronger and more robust and more agile, and more resilient network than any other vendor in this space. That's a given. You can Google on that, or if you're more of a Microsoft fan, you can Bing on that, but you can find information where Huawei really is notified and renowned for this. We would be crazy not to leverage that. We take the network, which we call the UC&C Foundation if you like. It's a high-end infrastructure. It's capable of carrying integrated voice, video, and data services and UC features. Once we've done that and we've done it on a global infrastructure and on a public infrastructure, we're privatizing and bringing that to the enterprise market. Then we leverage that by building up, wrenching out or just backing off because at one point, it hadn't been proven successful in a specific region or in a specific direction. We take it one step at a time, network first, services adding, and then branch out. That's the way forward.

Don Van Doren: Great. Wonderful answer. Thank you very much for being clear about that. I appreciate it. Thanks. Back to you, Blair.

Blair Pleasant: Okay, well, I think that Edwin did a great job of explaining Huawei and its differentiation. I know that we can keep asking questions for another hour or two, but we do need to stop here. I think that we all have a better understanding of the company and of its place in the UC market. I'd like to thank Edwin and my UCStrategies colleagues for a very informative podcast. Edwin, I hope that you can join us again. I know that this has been very informative for everybody. So thanks again, Edwin, and thank you everyone. Until next time. Bye-bye. 

 

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