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Huawei Aims to Sell the Nuts and Bolts of Global Cloud Computing

(Bloomberg) — Huawei Technologies intends to become a major provider of gear and software to global cloud computing providers, aiming for a $10 billion business by 2020.

The Chinese company will keep investing in the cloud, its fastest-growing business, as it seeks to supply chips, servers and other equipment to a booming market, said Ken Hu, the rotating chief executive overseeing the fledgling division.

Read more: Huawei to Pump $1B into Cloud Services Business

Huawei has begun working with foreign firms including SAP and Intel to crack the market for cloud services. Unlike providers such as Amazon and Alibaba, it wants to supply the basic components of computing infrastructure, as domestic industries from education to health care begin to move data online. China’s largest telecommunications gear company, also the world’s third-largest smartphone brand, may benefit from the local government’s preference for local over foreign technology.

“Cloud will penetrate in industries, including traditional industries globally. Adopting cloud computing is how they digitize their businesses,” Hu told reporters at the company’s annual cloud computing conference in Shanghai. “There are many different models for entering the global cloud computing market.”

Spending on cloud computing services in China alone could reach $20 billion by 2020, consultancy Bain & Co. estimates. Huawei will eventually target the global market, despite suspicions about Chinese espionage that have kept its networking gear out of the US. Hu said Huawei can rely on a large in-house research and development effort as well as its expertise on telecommunications equipment.

“Huawei’s experience and ability to integrate technologies in different areas is a unique advantage,” he said.

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