Huawei to Raise Annual R&D Budget by at least US$ 15 billion


Huawei faced security issues from the US, Australia and the UK after the countries alleged that the firm’s network, facilitates Chinese govt spying

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Chinese smartphone maker Huawei Technologies announced on Thursday that the company will increase its annual expenditure to between US$ 15 billion and US$ 20 billion on research and development (R&D), aiming to be a world leader in 5G technology.

Huawei will contribute 20 to 30 per cent to basic science

In 2017, Huawei had pledged to invest US$ 10 billion to US$ 20 billion annually on R&D, after having spent US$ 13.23 billion already on the same technology in the same year. The spent amount accounted for 14.9 per cent of Huawei’s total revenue.

In comparison to the above-mentioned pledge, this year, the company has decided to contribute 20 to 30 per cent of its R&D funds to basic science research. Approximately 80,000 of the firm’s employees that means 45 per cent of its total workforce is involved in R&D, the firm stated on its website.

Decision might be an aftermath of prominent nations cutting Huawei’s network due to security issues

There have been growing international tensions in the United States, Britain and Australia regarding pushing back Huawei’s network communications technology due to security reasons, and this declaration might be a result of the same.

A report by the UK government stated last week that technical and supply-chain issues with the company’s network technology caused Britain’s telecom industry to face security risks thereby reversing the previous endorsement. This report only added to a debate that has been going in the US and Australia for long, which accuses Huawei of facilitating the Chinese government spying on others – that the smartphone maker has repeatedly denied accepting.

On Thursday, the firm said that it plans to charge fair and reasonable (FRAND) rates for its 5G intellectual property to benefit the adoption of new technology, expected to be exposed to large-scale use in 2020.

Chinese firms headed by Huawei are thought to have ownership of approximately 10 per cent of the essential patents for 5G worldwide, which is an essential jump in comparison to their share in the 4G and 3G eras.

Huawei is one of the world’s top R&D spenders. Amazon and Google’s Alphabet are the two biggest spenders on R&D technology in the United States, having spent US$22.6 billion and US$16.6 billion, respectively, in 2017, as per reports by Factset, a financial data company.