In this blog I look beyond the obvious and try to find out why people and companies do what they do - and what it means for the rest of us. 
Greg Schultz (@storageio) tossed the idea out on Twitter yesterday, and it got me thinking. As I thought, I came to the conclusion that it is brilliant.
Huawei builds carrier class to SOHO networking gear. They, in the opinion of many, have the only full competitive lineup versus Cisco. They are a multi-billion dollar company – that you never heard of because they sell almost all their stuff in China, the rest of Asia, some in Europe and South America, and almost nothing in North America.
They have PILES of dough, huge technology advantages, supremely low labor costs, and an almost captive monopoly in the worlds fastest growing economy – China.
They also have a stigma, as they were caught with their fingers in the proverbial IP cookie jar a few years ago accidentally “borrowing” some IP from Cisco.
They kissed and made up, then in their infinite wisdom, they elected to try to get into the North American market by spinning off a group and joining forces with that stalwart of U.S. networking giants, 3Com. They formed H3C.
Fast forward to today – they still sell nothing in North America.
They could buy Brocade and instantly become a legitimate threat to the mighty Cisco, on every major front. Huawei even has excellent video capabilities to take them on with. Brocade/Foundry has held their own for a long time, admirably even, and has proven in can compete in some substantial markets – those that add value to Huawei’s lineup including fibre channel and upper layer networking. The Brocade/Foundry channel could easily slide lower cost Huawei products into their mix – and there are quite a few big dogs who would welcome the opportunity. HP and IBM come to mind.
One plus one could equal 10 in a deal like this.
Related posts:
- Brocade buys Foundry
- Brocade the boring business execution machine
- Brocade Buys McData
- HP and 3Com is a much bigger deal than you think
- The Brocade McData Deal – Big Trouble Potentially
Tags: Brocade, Cisco, fibre channel, Foundry, HP, Huawei, IBM
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Steve concur that modern math could be 1+1=10+ here.
After all, in addition to all of the points you make, lets also not forget about Huawei deals with storage software vendors including Symantec among others for the asian/oceiana/far east markets.
This is one of those fun, outside of the box type deals to think about, the type that those who think in the box would put it at a 150:1 (isnt that a dedupe ratio
) and thus like the odds of the MN Twins going all the way, you gotta put something into it…
Cheers – gs
I live at Sao Paulo city, BRZ. I agree with you that Brocade should be part of Huawei’s strategy if they want a huge competitive mkt against Cisco, Cisco was established and Leading Brazil comm´s since 90’s but now they are loosing many deals, specially about troubles with their major distributor called MUDE, legal issues is going to measure with severity by government and high executives.
I worked for Cisco during 90’s decade and 00’s, after that I worked as employee for Nortel, Brocade, Intel, HP, and my last 3 years I spent with EMC.
Our largest Brazil’s mkt follow battle, specially for communications and cloud computing, my suggetion is EMC+VMware+Cisco+Dell, HP+Cisco, IBM+Cisco against Huawei+Symantec+Citrix+Brocade+Lenovo, nobody will fight alone.
For me Intel and Microsoft are in the middle driving relationships, sharing executives like EMC did with Intel, but I developed business at all segments like enterprise, government & federal accts, I never before seen a serious battle like now, believe me.
Marcos Nobrega Jr,
[...] Last week I posted on twitter a response to a comment about who would want to buy Brocade with a response to the effect of why not a Huawei to which there was some silence except for industry luminary Steve Duplessie (have a look to see what Steve had to say). [...]
[...] might consider a diversification into hardware as well. One should also look to the East, where Huawei could try to enter the Western market with a merger or joint-venture to cast off the China stigma. Although I would love to see a rebel [...]