The rise of China's tech industry is fueled in part by its growing
investment in research and development. According to a study released in
December by U.S.-based Battelle Memorial Institute, R&D spending in
China will likely reach $284 billion this year, up 22% from 2012. That
compares with just 4% growth forecast in the U.S. to $465 billion for
the same period. It forecasts China will surpass Europe in terms of
R&D spending by 2018 and exceed the U.S. by 2022.
At Shenzhen-based Huawei Technologies Co.,
the world's second-largest telecommunications-equipment supplier by
revenue after Sweden's Ericsson, annual R&D expenditures rose
fourteenfold in a decade to $5.46 billion in 2013 from $389 million in
2003.
When
Peter Zhou
joined Huawei straight out of graduate school in 2000, the
company's Shanghai research center had a few hundred workers in a shared
office. Every Wednesday night after work, Mr. Zhou and other young
Chinese engineers gathered for study sessions, sometimes using
university textbooks from the U.S.
"At
that time, Huawei was not at the same level as Western companies," Mr.
Zhou, now an executive at Huawei's wireless-equipment business, recalls.
"We were like students."
But in the past decade, Huawei overtook Western rivals such as
Nokia Corp.
and
Alcatel-Lucent
SA
in the telecom-gear market. Part of its success stemmed from
Huawei engineers' creative ways to upgrade wireless networks using
software instead of a costly method of replacing all hardware
components, according to Mr. Zhou.
Huawei
now has an R&D center in Shanghai that employs more than 10,000
engineers, many of whom have computer-science degrees. As the mobile
industry deploys faster fourth-generation networks, Huawei is already
working on the technology for fifth-generation networks, which could be
ready around 2020.
Source:The wall street Journal
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