Huawei To Shutter Cloud Computing, AI Business Groups Amid Restructuring As US-China Trade War Bites


The news reveals troubles faced by the Shenzhen-based firm, namely amid the ongoing US trade war on China and ongoing COVID-19 pandemic, according to media reports.

Chinese telecoms giant Huawei Technologies has shuttered its core cloud and artificial intelligence (AI) groups after just 14 months of operations, Caixin Global reported on Tuesday.

A server and hardware storage unit as well as internet products and solutions department tasked with product research and development (R&D) have been formed amid the dissolution, the firm said in a 2 April internal memo.

The firm has appointed Zhang Pingan as president of its cloud business unit to replace former president of cloud and AI business group, Richard Yu.

The restructuring efforts reveal the company’s struggle to shift to a services provider, according to Nikkei Asian Review.

Huawei currently consists of its carrier network, consumer and enterprise business groups. The company’s cloud computing strategy was launched in 2010 and opened its business unit in the cloud services market in 2017.

Data from research firm Canalys reveals Huawei Cloud was China’s second biggest cloud service provider in Q4 2020, gaining 17.4 percent of the mainland’s market share. Alibaba Cloud remains the top firm with a 40.3 percent market share.

But the company’s cloud products were behind rival firms due to Huawei’s late arrival to the sector, a Huawei employee told Caixin in the report.

The developments come amid the ongoing US trade war on China, which saw the Chinese telecoms firm blacklisted along with numerous Chinese tech companies, including Shanghai-based chipmaker SMIC, ZTE and dozens others.



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