Huawei Wants to Blind Cisco TelePresence

  • Tweet  
  • LinkedIn  
  • Facebook  
  • Google plus  
  • Send to Kindle
  • Send to  

Huawei Technologies is expanding beyond its telecom switch core products to include video conferencing and high-definition telepresence as part of its strategy to become a $100 billion company by 2021. Standing in its way is Cisco, and it plans to take on the telepresence market leader.

The pan-Pacific rivalry between China’s Huawei Technologies Co. and Cisco Systems is spilling out of the data center and into the conference room. Huawei is planning a major push into the high-definition telepresence market, looking to blind side Cisco’s dominance in the life-like video conferencing technology segment.

Huawei desires to expand its 20 percent global market share is part of a larger plan to expand the company beyond its telecommunications equipment core and grow revenues from $32 billion today to more than $100 billion by 2021.

Related articles

Telepresence equipment accounts for a scant $200 million in sales for Huawei. Cisco, the San Jose-based market leader, sells nearly $1 billion in telepresence equipment and services. Neither are significantly large percentages of the respective company’s overall revenue. However, Huawei believes telepresence is a catalyst for other equipment sales in the enterprise and midmarket businesses.

Telepresence and video conferencing has been slow to take off. But, as adoption of video as a real-time communications medium takes off, so too is the potential for high-end telepresence and low-end video communicators. Infonetics estimates the telepresence and video conferencing market represents a $22 billion opportunity between 2012 and 2016.

The stakes are high for all companies and their partners in this market. Cisco, which is adjusting its structure and go-to-market strategy again, recently opened holes in the walled garden around its proprietary TelePresence service to help stem the growth of rivals such as Avaya, Polycom and LifeSize. While all video conferencing and telepresence vendors are reporting growth, the law of small numbers applies as the high growth percentages are generated by relatively small base numbers.

At the same time, Microsoft, Cisco and others are expanding their low-end video communications capabilities. Microsoft bought Skype last year for $6.5 billion. Cisco and Citrix enhanced the capabilities of video in their respective collaboration services, WebEx and GoToMeeting. And FaceTime is one of the key drivers behind the sale of Apple iPhones and iPads.

Some analysts believe Huawei can make a dent in Cisco’s market share, as its high-end telepresence unit has comparable features at roughly half the cost. Huawei is already plying the North America and European channels to increase sales capacity. In the U.S., Huawei is working closely with distributor Synnex to recruit and enable partners in the sale of its networking, storage and security equipment.

Huawei isn’t without controversy. Cisco fuels the suspicions of Huawei with reminders of its past practices in patent infringement. But the U.S. and other governments, too, fan criticisms of Huawei with questions of whether the company’s equipment could be used by China’s government and military to steal information. Huawei and ZTE, a China telecommunications and handset manufacturer, recently appeared before a U.S. congressional hearing titled, “Threat Posed By Chinese Telecommunications Companies.” Huawei executives testifying failed to assuage U.S. lawmakers fears, observers say.

The real question isn’t whether Huawei is trustworthy, but telepresence is needed after all. The proliferation of mobile and desktop solutions is making telepresence a tough investment to justify. Likewise, the cost of operating and the lack of broad interoperability make telepresence’s benefits limited. In the channel and among end users, telepresence remains complex, and that diminishes the user experience. Much has to change in this technology segment before any clear market leader truly emerges.

  • Tweet  
  • LinkedIn  
  • Facebook  
  • Google plus  
  • Send to Kindle
  • Send to  
More on Channel Business
Sales online and in the shops

Black Friday wearable tech uptake splits industry

Shoppers may have snapped up a bargain wearable device on Friday, but just how much impact will this have when they choose to wear it to work today?

Backbytes - a happy computer

Perk up! HP opens up former direct-only perks to the channel

Latest ServiceOne partner program released as Q4 results disappoint

Two men shake hands

Public offering: Ingram Micro and VMWare release new partner program

Public sector partners to benefit at no cost

learn-chalkboard

Watch and learn: Brocade EMEA merge watched carefully by U.S. arm

Benefits of channel and OEM business merge apparent in EMEA and APAC

Visitor comments
Add comments
blog comments powered by Disqus
In-depth
arthur-chang-pan-terra

Vendor Q&A Series: Arthur Chang, PanTerra Networks

The latest exec to sit in the Channelnomics hotseat is PanTerra Network's president and CEO

CCTV security

Post Sony hack, security appliance market remains red-hot

Growing security concerns continue to boost appliance sales

US soldiers running on a desert road during a military operation

Fight the good fight: VA enlists IBM's Watson for PTSD battle

Solution will focus on dealing with the large number of vets suffering from PTSD

davemaffei-vpofchannel-carbonite-2014

Vendor Q&A Series: Dave Maffei, Carbonite

The latest exec to sit in the Channelnomics hotseat is Carbonite's VP of global channel sales