What Is The Logic Behind Yu Chengdong'S Leadership In Cloud Business?

Recently, a top management change of Huawei may open the prelude of cloud business adjustment.

On January 27, the 21st century economic reporter learned that Huawei's intranet officially issued a document on the personnel changes of Huawei cloud & AI BG (cloud & AI BG).

According to the latest appointment document, Yu Chengdong, the current CEO of consumer BG, plans to increase the appointment of President (Part-time) of cloud & AI BG and director of cloud & AI BG administrative management team, President (concurrently) of cloud Bu and director of cloud Bu administrative management team. Hou Jinlong, the current president of cloud and computing BG, is to be appointed as the chairman of digital energy this time.

At the same time, Yu Chengdong is also the director of IRB (Investment Evaluation Committee) of intelligent terminal and smart car components. Therefore, Yu Chengdong will be responsible for Huawei's mobile phone, automobile and cloud computing business. Among them, automobile and cloud computing are the "stars of tomorrow" that Huawei focuses on cultivating, especially the underlying cloud business. As early as 2016, Ren Zhengfei, the founder of Huawei, called them "strategic opportunities".

Facing the AI wave and the future of cloud computing, in 2017, Huawei officially entered the public cloud market, and Huawei cloud was born in 2017. Xu Zhijun, chairman of Huawei's rotation, announced the establishment of cloud business at the Huawei ecological conference that year. In an interview since then, Xu Zhijun once said that in cloud business, Huawei is not in a hurry to encircle the ground, but to do a solid job in every service. "We don't look at whether the current (income) is 100 million more or 100 million less. We care about what will happen in 10 years." Xu Zhijun said.

Although it is later than Amazon and Alibaba, Huawei cloud has rapidly ranked among the top three in the domestic market in the past four years, and it is also integrated with Huawei's it computing product line, hoping to build a software and hardware platform. However, some Huawei insiders told the 21st century economic reporter that the development of Huawei's cloud has been controversial internally for a long time, and it is not easy to strengthen the cloud business.

Facing the AI wave and cloud future, Huawei officially entered the public cloud market in 2017. IC photo

"Addition and subtraction" of management structure

Why did Huawei make such a move? It can be analyzed from two aspects.

First of all, in terms of management and organizational structure, under the pressure of US sanctions, Huawei's mobile phone and other consumer businesses have been severely damaged. In order to survive, Huawei has chosen to sell glory. For the consumer business, the overall team size has been correspondingly reduced. At this time of troubled times, the senior general has been ordered to continue to challenge more difficult things and to do business that may have a greater future.

Yu Chengdong has successively served as president of wireless product line, President of European region, President of strategy and marketing, chairman of terminal company and CEO of consumer BG. He has led the team to achieve rapid development in the field of wireless and terminal. Now he will take the helm of cloud computing and automobile.

Some insiders told the 21st century economic reporter that "despite the sanctions imposed on mobile phones by the United States, after the recent adjustment, it is actually the main channel to continue to stabilize Huawei. The terminal and cloud application markets are one of the main channels, representing the present and future consumption scenarios. This is also Huawei's sustainable and potential business. "

In retrospect, after announcing the formal divestiture of glory on November 17, 2020, Huawei released a resolution on smart car parts business management in Xinsheng community on November 25, 2020. The automotive Bu was transferred to another sector in the framework of Huawei Company, transferred from ICT to consumer business and integrated with it, and appointed Yu Chengdong as the director of IRB of intelligent terminal and smart car parts.

For Huawei, the current industry is mainly network connected pipeline business and terminal business, while automobile is a new track opened by Huawei in recent years. At present, the core business is facing uncertainty, and automobile can be regarded as a new growth point for Huawei. Moreover, in terms of automobile technology, no country is in a monopoly position. The United States, Europe, Japan and other regions have their own strengths. In the long run, Huawei's layout of automobiles has few restrictions, and there are also opportunities for independent research and development.

After more than two auto business adjustments, Yu Chengdong will also be the president of cloud & AI BG. The importance of cloud business is self-evident. At the 2016 Huawei market work conference, Ren Zhengfei pointed out: "at present, 4K / 2K / 4G and the demand of enterprises and governments for cloud services have brought strategic opportunities to the network and data center. This is our major window of opportunity. We should dare to gather strength, invest intensively and attack saturation when this window of strategic opportunity opens. Jump on it, tear it up, develop in depth and expand horizontally. Our strategic goal is to make the pipeline platform bigger and stronger at a high level. "

In recent years, after integration with it product line, Huawei cloud and computing BG mainly includes cloud Bu, computing product line (server, etc.), storage and machine vision product line, etc. From Huawei cloud, Kunpeng chip, shengteng chip, mindspore deep learning framework to the landing of atlas computing platform, Huawei has planned the full stack route of AI and emphasized its ambition in computing power.

Both cloud computing and automobile are strategic industries Huawei has been targeting.

How will the cloud business pattern change?

Secondly, under the background of management level adjustment, it is the promotion of business level. As for Huawei cloud and computing BG, Huawei cloud is certainly one of Huawei's firm development directions. Huawei has its own advantages, but it faces challenges in its niche.

Just as Ren Zhengfei said in the speech of president Ren at the enterprise business and cloud business report meeting, Ren Zhengfei said: "huaweiyun is not the leading edge of our traditional hardware equipment. It is the change of Huawei's customer-oriented business model, that is, from selling products to selling cloud services. We must build the ability to sell cloud services and support the operation, operation and maintenance capabilities of providing cloud services to customers. While learning from Amazon and Microsoft, we should also make our 30-year network accumulation the unique advantage of cloud service market, create more space and build differentiated features. "

In the global common cloud market, Amazon AWS, Microsoft azure, Google cloud and Alibaba cloud occupy the top four positions. Among them, Amazon can be called an all-round player, with relatively perfect infrastructure, supporting applications and services; Microsoft has moved its own rich applications to the cloud; Google has its own characteristics in algorithms and intelligent cloud services; Alibaba cloud is the top three in the world, and has occupied many small and medium-sized customers in the domestic market.

Dai Kun, chief analyst of Forrester, told reporters of the 21st century economic report: "the global public cloud market continues to grow rapidly. Forrester expects that the public cloud infrastructure market will grow by 35% in 2021, reaching US $120 billion. Alibaba cloud is also expected to surpass Google cloud to rank third in the world, behind AWS and azure. In the domestic market, according to Forrester's evaluation of public cloud development and infrastructure and platform manufacturers in China in 2020, Alibaba cloud, Huawei cloud and Tencent cloud are among the market leaders. "

Dai Kun said that in the Chinese market, local cloud computing manufacturers and foreign manufacturers have their own advantages. In general, local manufacturers have different degrees of advantages in terms of service types, private cloud solutions, customer support capabilities and price system, while international manufacturers also rely on their own advantages in user experience, platform stability and reliability, global innovation ability and global market coverage.

After years of hard work, Huawei cloud has launched more than 200 services, developed more than 1.5 million developers and nearly 20000 partners, and has begun to take shape. At present, it continues to seize the opportunities of government, enterprise and Internet digitization to continue to develop.

"Huawei continues to maintain strategic investment in cloud computing business, and effectively builds a technology ecosystem covering software and hardware, cloud edge and full stack cloud service capabilities," Dai Kun told reporters. "At the same time, Huawei has demonstrated a wide range of solution capabilities in the evaluation process, and has unique advantages in 5g field."

It should be pointed out that at present, the public cloud market is still an oligopoly market, with Amazon and Microsoft occupying half of the country. Under the influence of the current U.S. regulatory policy, domestic enterprises are also affected in their overseas market expansion. For the domestic market, some cloud computing practitioners told reporters: "among domestic enterprises, companies with stronger strength will choose to build their own cloud, However, Alibaba and Tencent are often competitors. Enterprises will also have some concerns when choosing, and the competition is fierce. Moreover, Microsoft and Google have a strong promotion momentum in China in recent years. "

Next, it remains to be seen how Huawei cloud can develop the advantages of software and hardware integration and communication, expand more scenarios and make breakthroughs.

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