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Huawei to focus on cloud and AI business amid fierce competition

Cloud and AI division will become Huawei’s fourth business group.

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Huawei is ramping up efforts in cloud computing and artificial intelligence (AI) development, in a move to compete with other players in this sector, according to a report by financial news outlet Yicai.

The Chinese telecom giant has promoted its cloud and AI business unit as one of the company’s major business groups in its latest organizational structure and management team adjustment. After the restructuring, the cloud and AI division will become the fourth business group in Huawei, following carrier, enterprise, and consumer business.

Hou Jinlong, a Huawei veteran of 24 years and current president of the company’s cloud and AI business unit, will become the president of the new business group.

This move is also in line with Huawei’s “Cloud Only” strategy. First announced in April 2019, the plan aims to integrate all Huawei’s resources including chips, data centers, hardware, software, and computing infrastructures, to transform Huawei’s cloud services into a full-stack platform in the industry.

Although Huawei is one of the world’s largest telecom equipment and smartphone makers, it is still a newcomer to the cloud computing business. Huawei began optimizing its cloud business in 2017, when it formed a separate business unit for cloud services. Then, it expanded its business unit to cloud, AI products, and services in 2018 after integrating public and private cloud, big data, computing, storage, and Internet of Things services.

Huawei’s cloud business has also made a foray into 23 overseas markets as of June 2019 including Russia, Thailand, South Africa, and Singapore, according to Huawei.

The public cloud service market in China hit USD 2.46 billion in the first quarter of 2019, according to data from market research firm IDC. Huawei’s cloud computing ranked fifth on its home turf in the first quarter of 2019 with a 5.2% market share, following Alibaba (43%), Tencent (12.3%), China Telecom (7.3%), and Amazon Web Services (7.2%).