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Thursday, 18 September 2014
William Xu, chief strategy and marketing officer for Huawei. (Image Credit: Darryl Linington).
At the 2014 Huawei Cloud Congress Huawei revealed its Global Connectivity (GCI) findings. With findings from 25 developing and emerging countries that account for 78% of global GDP and 68% of population, and 10 industries, including finance, manufacturing, education, transportation and logistics, the report is, according to Huawei, the first quantitative assessment of connectivity and its value from both national and industrial perspectives.
William Xu, chief strategy and marketing officer for Huawei stated that the company would be placing a major focus on its Pipe Strategy. According to Xu, the Huawei has remained dedicated to enhancing areas such as connectivity and communication. Xu added that: “Today, our products and solutions enable close communication for a third of the world’s population. The global expertise we have enables us to challenge how connectivity can be developed in a scientific, comprehensive and objective manner.”
The overall study included enterprises from both developed and emerging countries, providing data across ten industries including: finance, manufacturing, education, transportation and logistics. While also assisting with analysing the findings and identifying trends.
According to Huawei, the study has found that country connectivity correlates with GDP, with Huawei’s analysis of 16 indexes showing that for each GCI percentage point increase the GDP per capital increases 1.4–1.9 percent, relatively higher for emerging countries. Among the countries surveyed, Germany ranked first… This was due to its strong commitment and ongoing investment in information and communications technology (ICT) development, resulting in a market with competitive vitality.
When it comes to an African perspective, the report revealed that developing countries have also started to accelerate growth by strategically investing in ICT capabilities. Among 25 developing and emerging countries, Kenya as well as Egypt came in strong with Nigeria and South Africa also showing promise. However, Huawei revealed that both Kenya and Egypt showed the highest growth momentum for the duration of the study for Africa. According to the company through centralised planning, potential connectivity can be fully leveraged and ICT capabilities will support positive growth of national economies.
To add to this, Huawei has forecasted that by 2025 as many as 100 billion connections will be generated globally, 90 percent of which will come from intelligent sensors. This increase will be attributed to enterprises becoming enabled by the internet. By leveraging connectivity to streamline business processes, reduce costs and improve efficiency, enterprises will drive innovation and move the focus from a consumer driven internet to an industrial one.
The report also covered how different enterprises invest in and gain from ICT, which will further identify why some industries are undergoing a digital transformation and some are avoiding the step forward. According to Huawei, in this process, the report was able to allocate each industry to one of four quadrants, Transformers, Strategists, Tacticians and Stragglers. It identified that Transformers regard ICT as a core driving force for business transformation and continuously invest and proactively reshape their ICT business models. Industries such as finance, education, oil and gas and manufacturing demonstrate ICT enabled transformation. With 71 percent of finance enterprises indicating their ICT investment will increase by more than five percent over the next two years, it is the highest ranking industry for development. The GCI reports that 65 percent of enterprises plan to increase their ICT investment over the next two years.
Mobile broadband, cloud computing, Big Data and the Internet of Things (IoT) are the four technological engines that most enterprises aim to focus on when completing ICT enabled transformation. Huawei forecasts that by 2020, global ICT spending will increase to approximately US$5 trillion. Today, ICT technologies based on connectivity remains significant as a support system, but this traditional role is giving way as ICT becomes increasingly integrated with production systems, driving value creation. Connectivity has become a new factor for production in addition to land, labor, capital, and technology.
At the end of his presentation, Xu added that: “It is our hope that the GCI will not only indicate ICT investment and development in various countries and industries but, more importantly, serve as a reference for industry policymakers and enterprise decision-makers. Looking ahead, Huawei will continue to work closely with industry partners to facilitate closer connections between people and people, people and things, things and things, creating a Better Connected World.”