7/6/2011 11:43:00 AM
Huawei shakes up distribution
Huawei UK is looking to expand its distribution network as it overhauls its channel strategy under the leadership of newly appointed executive VP Mark Mitchinson.
The Chinese telecoms giant has a UK distribution deal with Data Select and recently signed a European framework agreement with 20:20 Mobile.
However, in an interview with Mobile, Mitchinson made clear neither distribution agreement is exclusive. He added that Huawei would not rule out working with other distribution partners.
Mitchinson is currently leading a strategic review of the company’s distribution strategy. He said: ‘The distribution strategy will evolve further in the next few months. It’s about adding value.’
Mitchinson said UK distributors had improved their performance but reiterated his concerns about the role distribution plays in the market.
He said: ‘I’ve gone on record before as saying I don’t think distribution adds a great deal of value. They are starting to evolve and have begun to add a bit more value, but I still think there is more to be done.’
He added: ‘How are they going to differentiate Huawei in the market? When you have a standard platform like Google, differentiation is important for the manufacturer in the consumer, business and distribution space.’
Industry experts said Mitchinson will be looking for strong partnerships with Huawei’s UK distributors.
CCS Insight telecoms analyst Ben Wood said: ‘Mark will want to choose partners that add value to his proposition. He will not want simple box shifters but partners who will bring much more to the table.’
He added: ‘This is a crowded market with some very dominant players. Distributors have got to prove their worth. Mark is a deal maker and will drive a hard bargain to get what he wants.’
Neil Mawston, a director at telecoms analyst Strategy Analytics said: ‘These things are cyclical. Huawei is following a similar route to other handset manufacturers entering the UK market. They tend to expand the number of distributors they use over time as their market share rises and then once they are established they tend to look to rationalise the number.’
• Mark Mitchinson interview