By Yun-Hee Kim
LAGUNA BEACH, Calif.--Huawei Technologies Co., which has been
effectively shut out of the U.S. telecommunications-equipment
market on security concerns, hopes that investments in advanced
technology will help the Chinese company eventually break
through.
"It will take a longer time than it took in Europe and Asia for
entering the U.S. market," Huawei Senior Vice President Chen Lifang
said at the WSJD Live global technology conference Wednesday. "My
confidence comes from advanced technologies" like fifth generation,
or 5G, mobile technology, optical networking, cloud computing and
big data, she added.
Since 2012, Huawei, the world's second-largest telecom-equipment
maker after Sweden's Ericsson, has been the subject of concerns in
the U.S., Australia and the United Kingdom that the Shenzhen-based
company might have ties to the Chinese government. A U.S.
congressional report in 2012 recommended that the U.S. government
avoid using equipment from the firm, encouraging U.S. companies to
seek alternative vendors for their network gear.
Ms. Chen said the claims are "accusations with no facts
substantiating the claims."
"We will continue to work on improving security and make
investments," she said, noting Huawei's work on smartphone security
and data centers.
Huawei competes with the likes of Cisco Systems Inc. and Juniper
Networks Inc. in networking equipment. Responding to a question
about Cisco's struggles in China and claims of an unfair playing
field for foreign players, Ms. Chen said most of the backbone
telecom-network equipment used by the Chinese government, the
financial industry and telecom carriers in the country is provided
by Cisco and not Huawei
Boosted by strong sales in its home market, Huawei's earnings
have climbed steadily in recent years despite concerns about
security.
The company has forecast 2018 revenue of 435.7 billion yuan, or
roughly $71 billion, up from 239.03 billion yuan in 2013. Huawei's
revenue in China rose 14% last year as smartphone sales increased.
Revenue from the company's enterprise business, which helps
corporate clients build their internal communication networks,
increased roughly 30%, Huawei has said.
Ms. Chen said Huawei aims to sell 80 million mobile phones, up
54% from last year. Huawei's smartphones have little presence in
the U.S., but the company has been growing rapidly in other parts
of the world, especially in emerging markets.
In the second quarter, Huawei was the third-largest smartphone
maker in the world behind Apple Inc., with its market share jumping
to 6.9% from 4.3% a year earlier, according to research firm IDC.
No. 1 Samsung Electronics Co. saw its market share drop to 25% from
32% a year earlier.
For smartphones, Ms. Chen said that Huawei expects Chinese and
European markets to contribute further to its growth. China, the
world's biggest smartphone market, is transitioning to 4G mobile
technology, while the European market is a "high value market," she
said.
While there has been some consolidation in the global handset
market with rival Lenovo Group Ltd. acquiring Google Inc.'s
Motorola handset unit, Ms. Chen said Huawei isn't interested in
acquisitions to grow in the space.
Write to Yun-Hee Kim at yun-hee.kim@wsj.com
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