No this isn’t a terror alert. Nor an update to the ongoing Prism saga.
Huawei, one of the world’s leading suppliers of networking, telecommunications and storage is building momentum here in North America.
With the launch of their first channel program at their recent partner conference (which I had the pleasure of attending), Huawei is poised to be a disruptive force not only in the industry, but in the channel as well.
Targets Set on Cisco, Helping Channel Partners Become More Profitable
No great story is complete without a villan. In this one, it’s Cisco.
The networking giant, who owns 80% of the networking market, has gotten there through innovation, acquisition and a huge partner network. But over the last few years innovation has slowed, acquisitions have failed to materialize into aggressively growing business units and the channel has become a race to the bottom.
A perfect scenario for Huawei, who’s rally of “let’s be disruptive” has resulted in one of the most lucrative channel programs I’ve ever seen. And with thousands of products spanning almost every imaginable technology category, priced aggressively below Cisco equivalents, with 50% more margin for channel partners, disruptive they may well be.
The Road Ahead is Not Easy, But it is Lucrative
Of course having great products, at a great price, with lucrative margins for channel partners is a great start, but Huawei does face its share of hurdles.
First, there is general public perception. Whether real or perceived, the current FUD campaign launched against the company insisting hidden backdoors into product software have been made available to the Chinese government, has raised alarms and increased caution.
Second, Cisco is so large, so dominant and so entrenched, that Huawei will need to continue with a strategy of disruptive pricing and margins to try and woo away channel partners. Remember, no one ever got fired for buying Cisco.
Lastly, it is going to take time for things to develop. Moving with a great sense of urgency is appropriate, after all Huawei is essentially a startup in North America, but will the company have the patience to continually invest resources if the first year or two does not net tremendous results?
Whatever the case may be, it will be exciting to watch. If for nothing else, it’s great to see new market entrants who want to be disruptive.
That’s my kind company.