Editor's note: This opinion piece, written by analyst Handel Jones of IBS, was written in response to a recent EE Times blog that, quoting another analyst, proclaimed that Huawei recently converted a design from an FPGA to an ASIC for the first time. In the paragraphs below, Jones outlines Huawei's business, including the firm's use of ASICs over several years. Jones expects Huawei to use 35 ASICs in 2012, up from 24 last year.
Huawei Technologies Co. Ltd., the China-based multinational telecommunications equipment vendor, is expected to have 2012 revenues of about $32 billion. Huawei and Ericsson are the two largest communications companies globally.
Huawei is headquartered in Shenzhen, China, and while there are strong relationships with the Chinese carriers, such as China Mobile, China Unicom, and China Telecom, 70 percent of the company's revenues were from outside China in 2011.
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There is, however, the perspective that incentives are provided to Chinese companies to export their equipment, i.e., some similarities to the Export-Import Bank that is based in Washington, D.C. The result is that the equipment of Chinese communications infrastructure is sold into multiple countries.
Huawei is the global market share leader in LTE base stations, with approximately 45 percent market share. With China ramping up the installations of its TD-LTE infrastructure, Huawei is well-positioned to continue to experience strong performance in 4G base stations. In addition to the high-capacity base stations, Huawei is also developing technologies for pico and femtocells. The high growth of equipment sales and installations will give strong growth in semiconductor consumption.
A potential key vendor to Huawei in pico and femtocells applications could be Qualcomm with its recent acquisition of DesignArt. Mindspeed, with its PicoChip acquisition, can also be a key IC vendor to Huawei in pico and femtocells.