TSMG 5340
Wenzhao Li

HUAWEI: CISCO’S CHINESE CHALLENGER

The explosive growth of mobile Internet, fueled by the technological innovations, has affected every aspect of our lives. Mobile devices such as smart phones and PDA and even smart pets are now being interwoven into the fabric of our lives. The ultimate goal of all these devices is to bring all people into a networked society. Behind all these amazing devices, however, are the efforts of the telecom equipment companies, such as Alcatel, Lucent, 3Com and Cisco. Among all of these companies, there is a Chinese company, named Huawei, gradually being attention by the global telecom industry. For Huawei, its ambition is to catch up with Cisco as a world leader other than a domestic …show more content…

Doineau said, Huawei’s threat to the international telecom equipment suppliers was not to be overlooked. But in Huawei’s viewpoint, if all the competitors and potential partner regarding them as an intruder from “Chinese Military”, they would face serious threats due to the culture misunderstanding. On the other hand, the world leaders, like Cisco, could not freely give up their market shares to Huawei. The threat of face to face competition with them is another challenge to Huawei.

Huawei began considering international expansion in 1996 when it was looking for diverse sources of growth beyond the Chinese market. The company made its initial overseas moves in the markets of developing countries, to avoid “head to head competition with its international rivals such as 3Com and Cisco”. Huawei made its first significant international sale to a Russian telecom service provider in 2000, which was quickly followed by Advanced Info Service, Thailand’s largest mobile service provider, and Tele Norte Leste Participacoes, Brazil’s fixed line carrier. What’s more, major contracts won in United Arab Emirates, making UAE the first Arab country with 3G wireless communications. They set up CDMA network in Europe and expanded business in Portugal, Netherlands and GB.

Huawei’s success in global expansion cannot live without its competitive advantages comparing to the other companies: low-cost