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Huawei Targets U.S. Device Market

Wed, 10/12/2011 - 9:30am
Brad Smith

SAN DIEGO—The Chinese manufacturer Huawei, which has been stymied in its efforts to sell infrastructure to top tier operators, plans to be among the top three wireless device companies in the United States within three years.

The company is showing several new devices at its booth at the CTIA Enterprise & Applications Conference this week, including the T-Mobile SpringBoard Android-based tablet. The carrier announced the tablet as a preface to the conference. James Jiang, Huawei's executive vice president of product and marketing, said the device will be the "first affordable" tablet on the market but left it to the operator to announce pricing.

Huawei's U.S. strategy with tier one operators is to design and sell carrier-branded devices and gradually build its own brand recognition. In addition to the SpringBoard, the company is showing the T-Mobile Sonic 4G Mobile Hotspot and the Impulse 4G Android smartphone for AT&T Wireless. Also on display is a Huawei-branded device, the Ascend II Android smartphone being sold by Cricket Wireless.

Jiang said at a press conference the company is enjoying rapid growth with devices in North America, focusing on low-cost smartphones.

Bill Plummer, vice president of external affairs, admitted that Huawei may be the biggest company that most Americans have never heard of because of its behind-the-scenes strategy. Huawei has 120,000 employs worldwide and serves 45 of the world's top 50 operators in 140 markets. It has been in the U.S. market for 10 years, initially with infrastructure.

Huawei and another Chinese infrastructure company, ZTE, haven't had success in the U.S. because of political concerns over having a U.S. network running over Chinese infrastructure. Analysts say Huawei lost a potential contract with Sprint partly because of congressional criticism.

Ovum analyst Jan Dawson said Huawei now is using the model of Taiwan handset manufacturer HTC, initially producing carrier-branded handsets.

"This allows Huawei to get past its lack of name recognition in the U.S. while still getting its devices into carriers' shelves and consumers' pockets," Dawson said. "Meanwhile, smaller carriers Metro PCS and Cricket Wireless are willing to sell Huawei's devices under its own brand, which will start to overcome the problem of name recognition in time."

The analyst agreed that Huawei can leverage its competitive advantage of low-cost production to make affordable devices to sell in the U.S.

Huawei also is using the show to discuss its new enterprise business sector, created in a reorganization earlier this year but just publicly announced.

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