Hi, welcome to another ColdFusion video. Over the past year, we probably noticed Huawei appearing in headlines along with Samsung and Apple. As it turns out they're much bigger than just smartphones. They're are a huge force in the world of telecommunications way before they even released a smartphone. Today, we'll see how the Chinese giant grew to be one of the largest telecom manufacturers in the world and why they're at the center of so much controversy. Huawei technologies were set up in 1987 by Ren Zengfei. Usually, the founders of companies are young and vibrant but Ren was different. He was in the midst of a midlife crisis and in his mid 40's when he founded the company. He had plenty of technical expertise from his time as a Deputy Director at the People's Liberation Army Engineering co-op. So from the very beginning, the company has been tied in some way to the Chinese government, this will come into play later in the story. At this point in time in the late 1980's, China was a long way behind the western world when it came to telecommunication. Despite having a population of over one billion, there were just 200,000 phone lines when the 90's began. Huawei set up Shenzhen, a small fishing village that has since become the Silicon Valley of China only 30 years later. Firstly, the company importers switches from Hong Kong, a country which sat just across the river from China. The components with switchboards that allow the company to manage multiple internal and external phone lines. The demand was huge as China pushed to modernize and there was also a desire for a locally made Chinese product rather than relying on imports. So Huawei setup a huge research and development department that focused heavily on analyzing the equipment that was coming in and attempting to reverse engineer it. Within a few years, they had made the most of China's huge cheap talent pool of engineering graduates and created their own switchboard. They sold these throughout China with government support and soon began to focus on a digital version of the switch in 1993. The strong focus of research and development continued as they set up new facilities in Beijing and Shanghai. By 1996, they had their first international client albeit only in Hong Kong. The most important development for Huawei was the appearance of the Global System for Mobile coupled with the incredible adoption of mobile phone. Since their founding, Huawei had always been playing catch up with the rest of the world fighting just a match what was already being made but the mobile phone level the playing field. This was a new technology for everyone. Now, Huawei's research facilities became an enormous asset as they leverage them to sign partnership deals with many of the biggest tech firms from Intel, to Sun Microsystems, to Motorola and Microsoft. By 1997, they had their own GSM equipment in the market. While many other companies focused on handsets, Huawei's main products were running the mobile networks themselves. They'd be major players like Siemens and Ericsson, to win a contract to upgrade Berlin's communication network. In the same year, they created the world's first and largest wireless LAN network. By now, they were a global presence. They had a 1,000-person research facility in India, sales office in Berlin, and major contracts in the Middle East and we're starting to look towards Europe. In 2004, Huawei shipped their first phone, the C300. This would be the first step in an extensive rise to dominance. The name Huawei translated directly from Chinese means Chinese achievement and with a net worth of over $8 billion it seems that the company has done just that. Today, Huawei are the second largest phone manufacturer, ahead of Apple and behind Samsung. But they are looking to challenge Samsung from the number one spot in 2019. The high-end smartphones have been largely praised with them a 20 pro model winning and blind smartphone camera tests by Marcus Brown Lee, with the subject sample size over seven million people. Huawei is currently the largest telecom equipment manufacturer in the world with most countries using the equipment in the telecommunication infrastructure, more on this later. The company has a very interesting management style. In order to stay creative and always flying with a fresh ideas, Huawei periodically rotates their CEO's every six months. They have a 1.5 million square meter campus, with castle style buildings. To move around the campus, employees can take a train ride. Huawei has the own Technology Park and the university at their headquarters in Shenzhen, complete with student housing. Qualified IT graduates from the university are then offered careers in Huawei afterwards. The company employs a 180,000 staff. The average employee year age is 29 years old. The company has invested over $60 billion in R&D alone in the last 10 years. On the point of the University and Technology Park, will seem similar thing with Samsung. It seems like the Asian philosophy to business is very different, especially when the companies involved have close ties to government. It reminds me of how the United States was pouring money into science research and universities during the 1960's after the Sputnik launch. Such efforts resulted in the Internet back then, but today this may partly explain why Samsung and Huawei exploding in success, I wish more countries will put a dedicated focus towards the synergy between education and business. But despite all of these impressive feats, Huawei has a mass of trust problem. In its infancy, the company was more or less an offshoot of the People's Liberation Army. The company claimed that it had later restructured to be collectively owned by its employees. But some question, to what degree the Chinese government is still involved? This has been a major stumbling block for a number of big international deals. This is for two main reasons. Firstly, Huawei are accused of getting government subsidies that allow them to undercut the other big players. They already have access to cheap labor but if they're subsidized, it's unlikely any private business can compete with them on cost. The second more major reason is if the Chinese government is involved, then potentially they have access to the data flowing through the equipment of all the networks Huawei supplies equipment for, networks used all over the world. The NSA, CIA, and FBI have accused Huawei of being a front to spy on US and Canadian communications. Huawei has denied these claims that many experts aren't so convinced. The UK, Japan, Germany, and Italy have all being persuaded not to use Huawei infrastructure. In December of 2018, British telecom began dismantling Huawei infrastructure. This comes after New Zealand and Australia stopped using Huawei equipment. For these security reasons, Huawei smartphones aren't widely sold in the United States. In December of 2018, the CFO and daughter of the founder of the company, Meng Wanzhou was arrested in Canada. As you'll see in my upcoming video, China Big Brother edition, the Chinese government loves to get their hands on as much consumer data from any Chinese company at home or abroad, so this panic may not be unfounded. So with all of these accusations of mistrust, where does the company stand today? Well, with an annual revenue of over $92 billion and being one of, if not the biggest passant phyla of any company in the world and having a 197 Fortune 500 companies use their equipment while selling 200 million phones in 2018, it's fair to say that they're doing well. Huawei will keep focusing on research as it always has. But in Western nations, if they want to see more growth in smartphones or otherwise, they must gain trust, a task much easier said than done. So that is the story and size of Huawei. It's interesting to look at how they started but also the security concerns that aren't as well-known. If you've enjoyed this video, let me know. This has been Dagogo, you've been watching ColdFusion. If you've just stumbled across this channel, feel free to subscribe, I am sure you'll find a lot of interesting stuff around here. I'll see you again soon for the next video. Cheers guys, have a good one. ColdFusion, it's new thinking.
