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Huawei prefers organic growth to acquisitions

Huawei plans to grow using organic growth and not acquisitions with the company not confident about keeping its place as the third largest smartphone vendor.

The Chinese smartphone manufacturer is focused on steady growth over a long period of time as opposed to investing in another company in order to grow as quickly as possible.

"We're not expecting an explosive development of our smartphone business, rather we want to grow that business step by step," Eric Xu, deputy chairman of Huawei, told reporters in London, according to the South China Morning Post. "Ultimately we want to be the leading brand worldwide in smartphones, but it will take a while to get there."

Xu confirmed that the company hasn’t held any talks with BlackBerry over a potential acquisition and his comments make a takeover of French firm Alcatel-Lucent seem very unlikely.

Apart from the slow burner approach cited by Xu, he also stated that acquisitions aren’t favoured by Huawei due to the “potential product overlaps” that would inevitably take place were it to absorb a competitor.

Huawei’s position as third in the smartphone market behind Apple and Samsung is increasingly under threat from the likes of LG and Lenovo, but Huawei isn’t too fussed about this in the short term – as long as it’s there at the end of the marathon.

"We don't know if we can keep that spot next quarter and we don't care much about being No3 at any given quarter," Xu said. "We want to be an athlete in the long run and grow step by step."

The company this week announced it will be investing heavily in 5G research into various different things such as air-interface technology with Xu explaining that it plans to invest upwards of $600 million [£373 million] in the new technology.