Kingdom ‘has talent to push boundaries of technology’

Analysts recently predicted that Saudi Arabia’s spending on information and communication technologies (ICT) will top the $36 billion (SR135 billion) mark this year, driven in part by a desire to improve efficiencies and foster innovation in local industry. One of the companies at the forefront of that charge is Huawei, which has been operational in the region for the last 15 years.

In his first interview with Arab News on the occasion of his company’s 15th anniversary celebration, Charles Yang, the newly-appointed president of Huawei Middle East, said that last year Saudi Arabia ranked 19th in our global study in terms of creating a competitive market, affordable services, and excellent quality of service thanks to the country’s significant investment into ICT. As the only country named in the GCC, the Kingdom scored well in embracing today’s digital transformation.

Excerpts:

Q. Saudi Arabia is home to one of the world’s fastest growing ICT sectors. In such a dynamic environment, what do you plan to focus on in your new role as President?
A. My focus will be to collaborate with Huawei customers, employees and partners to further strengthen the success story of Huawei KSA while building a better connected world. As part of that commitment, we will have to deliver on a number of priorities. We believe that ICT has become a key enabler for the country’s transition to a digital economy. In Huawei’s latest global connectivity index, it was shown that if you increase ICT investment by 20 percent it can positively impact a country’s GDP by one percent.

Q. Can you tell me how Huawei started out in the region?
A. Huawei has always viewed the Middle East as a significant market where we can contribute to the development of the ICT industry. Since the beginning, we have expanded in line with the needs of our regional partners, but also with a great deal of focus. In the early days we were not the biggest player in town, but we knew there was a lot of opportunity for us to meet the demands of organizations in Saudi Arabia and beyond. Saudi Arabia was in fact one of the very first regional markets we started doing business 15 years ago. It was also an incredibly exciting time to be in the Middle East. The ICT industry itself was on the cusp of several major breakthroughs; many of which are the foundation of modern ICT intellectual property. Internet access was expanding rapidly at that time across the region, connecting many communities for the first time to the global information age.

Q. How has the organization changed since then, and what does Huawei’s footprint look like today?
A. Fifteen years ago, Huawei’s corporate structure looked considerably different than it does today. Nevertheless, our values have largely remained the same. We exist to serve our customers. Their demands are the driving forces behind our development. Then, like now, we can only succeed through our customers’ success. Today, we have offices across 10 countries in the Middle East with around 5,000 employees — of whom over 66 percent are local hires. In Saudi Arabia alone, we have around 1,300 employees. Investing in local talent through regional training centers, university partnerships, and joint innovation centers has been a defining characteristic of our journey during the last 15 years.

Q. Do you expect Huawei will need to make any changes in its relationship with local telecom operators as they undergo their own transitions in the coming years?
A. Yes I do. In the past several years, the boundaries between telecommunications and IT have blurred. Cross-sector competition is a fact that operators have to face. OTT services are increasingly prevalent, and that has a huge impact on operator’s core business. We are seeing some operators transforming to provide more innovative services in the region and also operate with more agility. This will transform operators to the next stage — a full ICT service provider. For our part, we need to provide consultancy for the transformation. There will of course be challenges, but I am optimistic about this transformation.

Q. Huawei has grown rapidly in the past couple of years, globally as well as in KSA. Do you think the company will be able to sustain this pace and why?
A. Over the past three years, Huawei Middle East’s CAGR has been above 20 percent. In the next 3-5 years, we anticipate sustaining that growth. Moreover, in this region, people dream with great ambition. Look at the King Abdullah Economic City (KAEC), the Expo 2020 Dubai, and the numerous smart cities under planning and construction. All these will require ICT infrastructure to enable connections for social development and improving people’s lives. Additionally, this region is now an early adopter of new technology. With our partners, we deployed the first 3G networks in 2003, the first 4G networks in 2011, and will deploy the first 5G networks in 2018. With this spirit, I believe we will grow together with our customers.

Q. Can we talk a bit more about what is happening in KSA specifically? How are things here different from other regions you operate in?
A. Saudi Arabia is a strategic hub between the worlds of trade, finance and energy. There is also a wealth of talent within the Kingdom that is capable of pushing the boundaries of technology — not only for the region, but for the world. This year alone we have launched a Joint Innovation Center with Saudi Aramco and King Fahd University of Petroleum and Minerals (KFUPM) enabling ICT technologies for the oil and gas industry. We have another innovation center in the pipeline with King Abdulaziz City for Science and Technology (KACST) on the advancement of mobile technologies. All of these investments are key to the development of the technology industry, the economy, and future generations of professionals in the Kingdom.

Q. What do you look forward to seeing happen in Saudi Arabia’s technology industry over the next 15 years?
A. A new technological transformation is just around the corner. Over the next 15 years, I think three major advancements will characterize the ICT landscape. First, a fully connected world will be established as 5G mobile broadband changes our lives. 5G will be deployed as a mainstream technology to support applications and IoT scenarios. In addition, we anticipate seeing at least 20 smart cities emerging in the GCC, including Saudi Arabia, to support the aspirations of the public to live more comfortably and efficiently. Finally, more cross-sector innovations will appear in the form of new energy technologies, artificial intelligence, industry 4.0, and smart homes. ICT will become an enabler for all of these. This will create unprecedented opportunities for the whole industry.