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Devices and Platforms |
NEWS |
Huawei’s devices and platforms are more mature relative to its Artificial Intelligence (AI) and cloud solutions, and at the conference Huawei displayed some of its accomplishments. Its HiSilicon division announced 10 million shipments of Boudica Narrowband Internet of Things (NB-IoT) chips in 2017, and the division is forecasting shipments of 150 million in 2018. It also has an aggressive time frame for 5G-capable devices. In 2018 Huawei plans to offer the first 5G home router and in 2019, their first 5G smartphone.
Huawei is also rounding out its IoT device portfolio with the Huawei LiteOS, designed for Low-Power, Wide-Area (LPWA) devices, particularly NB-IoT devices. It offers multi-MCU and multicommunications protocol support, a low-power framework for MCU-based application development, and IoT device-to-cloud platform support with the benefits of reduced development costs and fast delivery to market. Huawei is forecasting that 20 million LiteOS devices will ship in 2018, growing to 120 million LiteOS devices in 2020.
Huawei’s device-to-cloud IoT platform, OceanConnect, announced 140 million subscribers. While the vast share of these subscribers are for connectivity management, this number represents a more than doubling of its base. Automotive and smart cities apps will continue to be focus areas for OceanConnect, but it is also interested in the industrial segment.
AI and Cloud Solutions |
IMPACT |
AI is a major area of investment for Huawei, and it has an impressive and daunting ambition: nearly every area of the company has an AI initiative—network infrastructure, OceanConnect, HiSilicon chips, smartphones, and cloud services. Within its network segment, Huawei’s AI solution, called SoftCOM AI, is targeting value in three areas: Operations and Maintenance (O&M) efficiency, resource utilization, and energy efficiency; the main reason for this is that it has over US$1 trillion of installed network equipment. Within its smartphone division, Huawei has launched HiAI, a toolset of AI functions for app developers that includes automatic speech recognition, natural language understanding, and computer vision. HiAI includes not only the device AI engine but also the Huawei Kirin 970 chipset, which is an AI processor. HiAI cloud services is another element of its mobile computing platform, although beyond developer portal access, it is unclear what AI functions Huawei is offering.
Huawei’s cloud ambitions are very clear. They want to be one of the big five cloud providers next to Amazon, Microsoft, Google, and Alibaba. A major component of their strategy in achieving this goal is to market cloud services in combination with other Huawei products and services. For instance, Huawei’s Digital Platform for AI includes a stack of Huawei products, starting with intelligent devices; its suite of networking, data storage, and compute cloud services; and AI platform services from its Video Cloud platform and FusionInsight Big Data platform with the stated goal to make data sharing and cooperation among different “neurons” easy.
Analyst Recommendations for Huawei IoT |
RECOMMENDATIONS |
The products, services, and activities from this year’s Global Analyst Summit indicate that Huawei is not only enhancing and improving its IoT offerings but also building a substantial market presence, particularly within the Chinese market. However, ABI suggests the following growth recommendations for Huawei to effectively move its IoT offerings to the next level and to expand globally.
Align Its Professional Services to 5G Opportunities: 5G will offer an incredible amount of capability that operators can leverage to provide cost effective and customized services for applications that need some or all of the following capabilities: massive broadband, low latency, and massive, high density connections. However, it is unclear if operators will take the leap into offering the consultative services that can maximize adoption of 5G services, including implementation, analytics, and cloud components. With deep knowledge of nearly all hardware and software services that comprise 5G, Huawei is in a perfect position to offer consultative services to help companies assemble the right mix of 5G hardware, software, and services. Private 5G network opportunities will be the immediate opportunity in enterprise IoT markets, such as transportation, logistics, plant/warehouse operations, manufacturing, and industrial.
Market the Right Value Proposition in NB-IoT Services: There are many benefits possible with a deep penetrating, LPWA, and low device cost solution in NB-IoT, but these benefits can quickly dissipate if the device and network operations are not optimized. Offering a Battery-as-a-Service solution as part of its OceanConnect ties a bow around these benefits. Interestingly, Huawei does have such an offering through its ThingsCoverage assets; it just needs to be marketed better. Another area of value that Huawei could help drive is innovation of NB-IoT network-based location services.
Build a Partnership Strategy that Embraces Coopetition: Huawei is very operator friendly and has been consistent in positioning itself as an operator partner. Its goal to be a top five cloud provider puts it at odds with the operator’s cloud efforts, however. The reality is that coopetition will only increase as Huawei expands investments and offerings in more technology enablers. Relationship risk should be embraced, as this will be the new market paradigm. Companies who are early to this game will be better prepared to navigate this market.
Recognize that Success in NB-IoT Is an End-to-End Solution: The reality of NB-IoT is that revenues from devices, connectivity, and connectivity management will become commoditized, and real value will be in a full solution offering. Huawei needs to start now in assessing end-to-end solutions in order to leverage its smartphone, platform, cloud, and AI technologies. Creating these solutions and offering them in a white-label format will smooth some of the potential friction with partners. Asset tracking, agriculture, and smart city applications are perfect areas to start. Deutsche Telekom’s smart city offering, Park and Joy, is an admirable template to consider for building an NB-IoT solution set.