Huawei To Challenge Cisco With Bold U.S. Enterprise Channel Push1:30 PM EST Wed. Oct. 05, 2011
Huawei on Wednesday formally launched a channel program for U.S.-based partners, part of an overall push by its enterprise networking unit designed to establish the China-based networking giant in markets around the world.
The Huawei channel program, which will roll out first to U.S.-based solution providers but is also being promised to Canada in the near-term, will be housed under Huawei's U.S. Enterprise Group based in Santa Clara, Calif., which is part of Huawei's global Enterprise Business Group. The global group was recently formed as part of a restructuring of the parent company, Huawei Technologies Co. Ltd.
The goal, according to Huawei's U.S.-based enterprise and channel team, is to do 100 percent of Huawei's enterprise sales here through channel partners. Huawei is making the official unveiling in line with Interop New York this week.
"We have a long-term commitment to the U.S. market," said Kevin Lu, director of channel management, in an interview with CRN. "Sales training, pre-sales and post-sales training, all of it is in line to work with our partners to be able to sell our products quickly."
Huawei has previously not had a major U.S. presence, but its international growth has earned it the attention of the IT industry's biggest vendors. At Cisco's recent Financial Analyst conference, for example, Cisco Chairman and CEO John Chambers described Huawei as "a very tough competitor over the long term," listing Huawei alongside HP, Juniper and Avaya as the vendors whom Cisco considers its fiercest competition.
Based in Shenzhen, China, Huawei was founded in 1988 and is employee-owned, with about 120,000 employees worldwide. Critics have in the past pointed to Huawei's alleged ties to the Chinese military -- ties Huawei has consistently denied -- and the U.S. government's concerns stemming from those allegations, as a reason for its low penetration in the U.S. market.
But there's no denying Huawei's place among the world's established networking vendors. Its products run the gamut from telecom infrastructure equipment, a market in which by most estimates it holds the No. 2 global market share behind Ericsson, to tablets and smartphones.
Huawei reported about $28 billion in revenue last year, and according to U.S.-based representatives, $2 billion of that was global enterprise sales.
William Plummer, Huawei's vice president of public affairs, told CRN that Huawei expects that enterprise revenue number to double this year. Huawei is unlike any other U.S.-based networking competitor because it's an established international brand with the backing of its corporate parent and global resources, not a networking startup or a market newcomer, he said.
"We're in an incredibly unique position in the marketplace," Plummer said. "The key to our success is our investment here. We're going to grow, we're going to nurture and create an open, interoperable and partner-based ecosystem system. The ecosystem in North America is as ripe as it is anywhere else."
The goal, Lu and Plummer said, is for Huawei to recruit U.S. channel partners looking for alternatives to Cisco and other established networking players and offer financial incentives to help those partners win deals.
"It's obvious to us that there is room for competition," Plummer said. "There is latent demand for new competition and new innovation this space, whether in the U.S. or elsewhere.
Next: Details Of Huawei's Partner Program
The channel program will authorize U.S. Huawei partners to sell Huawei's Ethernet switches, routers and video telepresence products. Huawei's overall product portfolio goes far further and wider, but Huawei representatives told CRN it will be those three product lines for now.
Consider those initial offerings "phase one" of the program, Lu said.
Huawei will work with VARs and systems integrators in a traditionally-structured channel program that offers better rewards for more commitment to Huawei. A dedicated Huawei sales team, which Lu called "high-touch," will assist Huawei's partners.
The specifics of the partner program are still somewhat vague. Huawei hasn't yet disclosed the partnership categories or the prospective levels of partnership reward, such as discounts, for each category, but Lu said partners will be categorized based on their volume commitments to Huawei, and their technical certifications. In return, they will receive incentives such as discounts, co-branding resources and market development funds from Huawei.
Huawei declined to name any of the U.S. channel partners with whom it is currently in discussion to join the program, as well as the number of partners with whom it's speaking. Huawei Symantec, the subsidiary of Huawei and U.S. security giant Symantec, will be a partner of Huawei's enterprise team, the executives said.
A major U.S.-based solution provider that partners with Cisco told CRN that he would "listen to Huawei's pitch."
"This is a very crowded market," said the solution provider, who asked that his name not be used. "I understand that a lot of their products are comparable to what's out there and are probably priced cheaper than what Cisco has in some cases. It's interesting that they're going 100 percent channel and I do see them being aggressive in trying to get in front of us."
"I think they have their work cut out for them," the partner said. "But they are a big worldwide player and that's going to help them. Huawei is no startup."
Lu and Plummer said Huawei is also in discussion with two-tier distributors in the U.S., but similarly declined to name the parties involved. One of the distributors is believed to be Tech Data, which declined to comment when asked about Huawei by CRN.
Representatives from Ingram Micro did not return a request for comment on Huawei by CRN.