Huawei intensifies cloud sector competition
Newcomer has advantages in serving businesses with high technologies
Published: Dec 26, 2019 08:53 PM

Huawei launches one-stop teamwork platform WeLink in Beijing on Thursday. Photo: Courtesy of Huawei

China's tech giant Huawei Technologies launched a one-stop teamwork platform WeLink in Beijing on Thursday amid risks in overseas markets, intensifying its cloud competition with global rivals.

Integrated with functions such as Mail, Meetings and Calendar, the platform is designed to protect companies' data and information security and guarantee that information circulates within companies, read a press release that Huawei sent to the Global Times on Thursday.

Recent weeks have seen Huawei Cloud enter the fast lane. On December 6, a new subsidiary - Huawei Cloud Computing Technology Co - was established, with registered capital of 50 million yuan ($7.1 million) and Huawei Vice President Zheng Yelai as its legal representative.

Huawei entered the public cloud service markets in 2017, when then Huawei rotating CEO Xu Zhijun announced the establishment of the Cloud Business Unit.

Although a newcomer compared with internet giants like Alibaba and Tencent, Huawei has advantages in serving businesses, providing full-series solutions supported by its research capability, and targeting global markets, Fu Liang, a Beijing-based telecom industry expert, told the Global Times on Thursday.

Huawei's cloud services applications are expected to focus on the domestic market, especially enterprises, while relevant technologies may be exported to other markets, Fu said.

Along with enterprises' digitization transformation and their demand for higher information safety, the global cloud service market is showing an explosive growth.

The US will be the largest public cloud services market, representing more than half the worldwide total through 2023, while China will see the fastest growth in public cloud services spending over the five-year period with a 49.1 percent compound annual growth rate, industry data provider International Data Corp (IDC) said in a report in July.

The US started earlier than China in the cloud computing sector. Amazon began to provide internet infrastructure services to other enterprises in 2006 and Microsoft announced Azure in 2008, while Alibaba Cloud was established in 2009.

Cloud computing is classified into three layers - infrastructure as a service (IaaS), platform as a service (PaaS) and software as a service (SaaS).

In the first half of 2019, China's overall public cloud service market reached $5.42 billion. The IaaS segment maintained steady growth of 72.2 percent year-on-year, according to a separate IDC report.

In the IaaS+PaaS market in China, Alibaba, Tencent, Amazon Web Services, China Telecom and Huawei command a total of 74 percent market share, maintaining their leading edge, according to IDC.

A cloud war has just begun in the sector, which requires technological research capacity and heavy investment. Every player has an opportunity to outperform its peers, according to analysts.

"Alibaba's cloud computing has advantage in e-commerce, Tencent's in online games and Huawei's cloud service has potential in the industrial internet as it provides networks," Xiang Ligang, a veteran industry analyst, told the Global Times.

However, Huawei will face fierce competition from these powerful players in prices and services, among other aspects, Fu said, noting that Alibaba is expected to hold a leading position in the future.