Chinese-based network equipment maker Huawei Technologies is finally starting to sell its enterprise line of switches, routers, Wi-Fi, storage and unified communications gear in Canada two years after being available in U.S.
For several years Huawei has sold telecom switching gear to carriers here including BCE Inc.’s Bell Canada, Quebecor Inc.’s Videotron, SaskTel and Wind Mobile. It also has a telecom research lab in Ottawa.
But it put off selling its enterprise line until this week, when it announced Capella Telecommunications of Peterborough, Ont. will be its Canadian distributor. (Editor’s note: After this story was published Huawei Canada said it also has distribution arrangements here with Synnex and CTDI, but they haven’t been announced yet.)
It is expected Huawei will leverage its Chinese manufacturing base to push traditional networking vendors like Cisco Systems Inc., Juniper Networks and Hewlett-Packard Co., particularly on pricing.
“We can deliver innovative product solutions at an attractive price point,” Darren Hamilton, Huawei Canada’s enterprise channel manager, said in an interview today. “We’re bring new dynamic to the marketplace in terms of price-performance and value.”
Asked by it’s taken so long for the company to sell to enterprises here, he said that “we’ve spent several months building a go-to market strategy, finalizing distribution, making sure we had the right programs, product mix. We’ve gone about it thoughtfully. It may seem like a long time but we’ve done everything correctly to be successful.”
Huawei may have been cautious because the Canadian market is small. On the other hand, by waiting it got caught last year in an uproar in the U.S. Congress on whether Huawei and China’s ZTE should be allowed to be carrier suppliers to American government networks because they are allegedly too close to the Chinese governments.
A House of Representatives intelligence committee said that “based on available classified and unclassified information, Huawei and ZTE cannot be trusted to be free of foreign state influence and thus pose a security threat to the United States and to our systems.”
This morning Scott Bradley, Huwaei Canada’s vice-president of corporate and government affairs, dismissed any suggestion this could impact enterprise sales.
“We’ve been dealing with Canadian operators for five years,” he said, “and there’s never been an issue. What’s important is operators have asked for choice, and those CTO’s have been making decisions based on what’s best for their organizations. We feel on the same level that enterprise CTOs are in the same position – they can make the decisions that are best for their companies. Every organization has their own requirements.”
Zeus Kerravala, a U.S.-based industry analyst who heads ZK Research, says Huawei has grown slowly in the U.S., but not because of its products. “I think their lack of growth in the U.S. market is perception – customers I’ve talked to just aren’t sure what to think of Huawei. There’s no proof there are back doors in their products or the company is being used to help the Chinese government spy on the U.S. – there’s no proof that it’s not, either . I just think that when it comes to a company’s network more companies would rather take the safer approach and not consider Huawei
“I think there’s a lot of disinformation out there – one (U.S.) company I talked to thought it’s illegal to buy Huawei stuff. For Huawei to start gaining some traction in North America need to land a couple of big, marque [enterprise] customers. That will also help to build the channel.”
Huawei’s product line is extensive. In routers, the top of the line AR3200 AR G3 series routers can forward up to 5 Mpps, and offer WANspeeds of up to 1,800 Mbps. The CloudEngine high performance 12800 core switches provide as much as 48 Tbps switching capacity with up to 288 40GbE ports. At the other end, the S1700 Ethernet access switch is aimed at SMBs.
Hamilton said one of Huawei’s “secret sauces is its eSight network management suite.
Capella was chosen as Canadian distributor because it has a “Rolodex of partners, he said, which has expertise in demand generation. Although some solution providers have been signed he didn’t want to name them yet.
Huawei Canada is looking for no more than 300 channel partners here, he said, particularly those who assemble networking solutions.
The company has a three-level partner program, with product margins increasing at each level.