618 [Huawei and 3G]
When Song left the United States, Google had already announced the auction listing.
That battle, that reaction, was like throwing a boulder into a pit. The old shareholders and underwriters standing on the edge of the pit were splashed with feces and urine in an instant when their trouser legs were splashed, and they were disgusted by Google from their souls to their bodies.
Song Weiyang is also an old shareholder, but strictly speaking, he is a founding shareholder, and he is a beneficiary like Larry and Sergei.
Shareholders, including Sequoia Capital, do not want to continue to increase their holdings at the IPO stage because they are not confident in the auction listing. The truth is not far off, as the Wall Street downturn caused Google to offer at least $40 less than expected. And even if it was issued at a low price, it only rose by 18% on the opening day, which is completely inconsistent with Google's excellent performance.
The situation at that time was so miserable that there were no investment institutions willing to participate in the auction. Google had to raise its own money, otherwise the IPO would be unsuccessful, and the company's employees would eat a quarter (all early employees who received equity incentives and could be bought at auction at ultra-low prices, and these employees had at least 500 or more shareholders).
Before leaving the United States, Song Weiyang also gave Larry and Sergei a reassurance: "If Google's IPO auction does not respond, then I will pay $50 million for my own participation!"
Larry and Sergei were impressed, and both said that Song Weiyang was the most trustworthy friend and partnerβat least that's what he said.
Departure lounge.
Song Weiyang was reading with Erlang's legs crossed, and suddenly Shen Si reminded in a low voice: "Boss, Huawei's Mr. Ren is over there!"
Song Weiyang looked up and looked ahead, only to see Mr. Ren and two middle-aged people, sitting in the corner without saying a word.
"Mr. Ren, you have also come to the United States. Song Weiyang walked over with a smile.
"Boss Song?" Mr. Ren looked a little surprised, stood up and shook hands and said, "Long time no see, please take a seat!"
Song Weiyang sat down and said, "Come to the United States to negotiate?"
Mr. Ren nodded and said, "Well, I finally confirmed it, but the negotiations broke down." β
Song Weiyang said with a smile: "It's good that the negotiations broke down, so why sell Huawei?"
"Perhaps. Mr. Ren smiled bitterly.
Because Song Weiyang invested in Huawei a few years ago, he was told of the negotiations as early as New Year's Day, and the content was: Huawei was sold to Motorola for $7.5 billion.
You heard it right, at the end of 2003, Mr. Ren wanted to sell Huawei in its entirety.
Negotiations lasted for several months, the contracts of intent were signed, and the relevant formalities were completed. In order to celebrate, the negotiation teams of the two sides also bought flower clothes to wear together, and ran and played table tennis on the beach. As a result, at this time, Motorola's new chairman took office and directly vetoed the acquisition that had already signed a contract, preferring to pay huge liquidated damages rather than buy Huawei.
As for why Mr. Ren sold Huawei, the reason is very simple, internal worries and external difficulties!
The root cause of everything is the Internet winter, not only the global Internet industry is declining, but also the telecommunications-related industries are in mourning. In 2002, Huawei's sales showed negative growth for the first time, and Mr. Ren chose to expand against the trend, allocated too much capital to invest in R&D, and opened a large number of overseas branches, trying to take advantage of the Internet winter to seize the market.
At a time when funds are seriously tight, Huawei cannot afford to pay salaries at all, so it can only continue to fool employees into exchanging salaries for stocks. This caused a strong backlash from many employees, because the market situation made them panic, completely hopeless, and even more afraid that the previous stocks would also be lost, so a large number of employees chose to resign and cash in equity.
After resigning, many employees joined the company of the traitor Li Yinan, bringing technology and resources to compete with their old boss Huawei for the market.
The house leak happened to rain overnight, and Mr. Ren's old partner Zheng Baoyong was diagnosed with brain cancer at this time. Cisco also jumped out to sue Huawei for infringement, and many European and American customers stopped cooperating with Huawei, and the lawsuit took nine months to reach an out-of-court settlement.
"Is Huawei really out of money?" Song Weiyang asked.
Mr. Ren said with a tired face: "There is money." Cutting some R&D projects and laying off some overseas institutions can fully support the money saved. β
Song Weiyang nodded and said: "It's the strategy to shrink, Alibaba was like this two years ago, and now it's not back." By the way, since Huawei is so short of money, why not learn from ZTE to make mobile phones and PHS?"
"Of course, Huawei also makes mobile phones, and after a while, Huawei mobile phones will be on the market, just in time for the worst market environment. Mr. Ren smiled bitterly. He didn't want to make mobile phones at first, and said that whoever made mobile phones would be fired, but he still couldn't escape the law of true fragrance.
"You're just starting to make mobile phones now, so you're really unlucky. Song Weiyang couldn't help but tease.
Mr. Ren said: "Who says it's not, people are unlucky, and they can even stuff their teeth with water." β
Last year, the prosperity of domestic mobile phones reached its peak, and now it has begun to flourish and decline, and vicious competition has reached an unimaginable level. Take Panda mobile phone as an example, the sales in the first two quarters of this year were more than 900 million yuan, and the net profit was only a pitiful 1.5 million yuan. sold nearly 1 billion yuan of mobile phones, only to make 1.5 million yuan, domestic manufacturers have made mobile phones into cabbage!
The reason is that there are more and more mobile phones, and domestic brands can only continue to reduce prices and promote - as long as they don't lose money, they have to sell even if they lose money, because the loss of hasty production is greater!
For domestic mobile phone manufacturers, since Lao Tzu sells cabbage at the price, don't ask my products to have black truffle quality. All kinds of cutting corners, all kinds of lowering standards, and even quality inspection are perfunctory, resulting in more and more garbage domestic mobile phones, and the market reputation has been damaged by these people.
Shenzhou mobile phones, which have always been strictly controlled by quality, are negatively affected by domestic word-of-mouth, and this situation often occurs at the sales counter - a few friends come to buy a mobile phone together, and someone plans to buy a Shenzhou, and the next one begins to dissuade: "Don't buy domestic mobile phones, it's too rubbish, and there will definitely be problems in two or three months!"
Compared with the self-abandonment of domestic mobile phones, Motorola and Nokia continue to launch new products and develop new features. The price of its old models has also been reduced, even to the point that it is similar to that of domestic mobile phones, and consumers naturally choose old foreign mobile phones with good quality and cheapness.
Judging from the sales in the first quarter of this year, the sales of Shenzhou mobile phones are increasing, but the net profit and market share are seriously declining.
In the case of serious financial difficulties, Huawei spent more than half a year doing research and development, and it was about to launch Huawei mobile phones, but it encountered such a market environment.
Song Weiyang asked: "Huawei's upcoming 3G mobile phone, right?"
Mr. Ren hesitated for a moment, nodded and said, "Well, it's a 3G mobile phone." Originally, I planned to develop both domestic and foreign markets, but judging from the current situation, Huawei mobile phones can only focus on foreign markets. China is also developing 3G mobile phone technology, right?"
"Yes, it has been in development since last year, but I am afraid it will not be put into commercial use, and it is a kind of technology accumulation. Song Weiyang nodded.
Although the domestic mobile phone brand is garbage as a whole, there are still a few companies that are serious about technology, among which Shenzhou, ZTE and TCL are representatives. The quality of ZTE and TCL mobile phones was not good at the beginning, that was because the foundry was blind J8, and TCL even built its own mobile phone production line last year, but unfortunately it encountered changes in the market environment as soon as it was put into production.
The research and development of 3G mobile phones, there are probably these companies doing: Shenzhou, Huawei, ZTE, Datang, Lenovo, Xiaxin, Hisense and Southern Hi-Tech.
Huawei is the only one that can really be put into commercial use in a short period of time.
Since 2004, Huawei has been selling mobile phones, and the reason why it is not well-known is because it mainly sells customized phones. The operators who have launched 3G services around the world are all potential customers of Huawei, and most of the mobile phones directly hit the operator's trademark, and you can only see Huawei's LOGO when you disassemble the battery board.
"Why isn't Shenzhou's 3G mobile phone going to be put into commercial use?" asked Mr. Ren very curiously.
Song Weiyang didn't hide it, and said with a smile: "Because I'm not optimistic about the 3G market, I want to jump directly to the 4G era." β
Mr. Ren said: "Very strange idea. β
Song Weiyang smiled silently, although he didn't make mobile phones in his previous life, he knew too much about the market situation of 3G mobile phones. Song Weiyang has a friend who once acted as an agent for 3G mobile phones in Hong Kong City, and lost a lot of money, and when he went back to the mainland to drink, he complained: "The money I lost by selling mobile phones, I might as well donate it to the casino on Ao Island!"
Well, Song Weiyang's friend was miserable by Huawei at that time.
In order to conquer the 3G market in Hong Kong City, Huawei Mobile not only invested in helping operators build networks, but also sent a large number of mobile phones to Hong Kong Island citizens for trial. It is said that it is a trial, but in fact, it is to send mobile phones and phone bills, and citizens can make 3G calls without paying a penny. There was such a good thing, which led to the 3G mobile phone brand represented by Song Weiyang's friend, which had no sales at all during that time.
However, Huawei's 3G mobile phones still suffer a lot of losses, and it should be said that all those who make 3G mobile phones are miserable.
A license is required to produce mobile phones in China, but except for the first batch of mobile phone licenses, which are very strict, later licenses can be obtained on a curve. The most direct way is to throw money, at that time, many domestic manufacturers thought that 3G was promising, so they spent a huge amount of money to buy 3G mobile phone licenses, and the results were lost one by one.
It wasn't until Steve Jobs led the smartphone revolution and the APP model matured that the 3G business became profitable, and 3G mobile phones began to sell well.
During this period, Huawei invested 5 billion yuan a year in the research and development of 3G technology at most, but there was almost no market return.
Song Weiyang had a whim: "Mr. Ren, why don't we merge the chip labs of China and Huawei to form a chip design company together?"
Mr. Ren felt a little interesting and asked, "How do you do it?"
Song Weiyang said: "The patents previously obtained by both parties belong to each other, and if the other party wants to use them, they must pay patent fees according to the market price." As for the value of the laboratories of the two sides, let the professionals calculate when merging, Huawei's chip lab will definitely be more valuable, and Shenzhou Technology can come up with some more cash. If the chip company separated and merged is an independent operation, if it needs to continue to invest in research and development, then Huawei and Shenzhou will continue to inject capital according to the proportion of shareholding. In this way, we can avoid duplicating R&D investment with each other and realize technical interoperability. β
"How to avoid business disagreement and competition?" Mr. Ren asked.
Song Weiyang said with a smile: "The chip company operates independently, and it is regarded as a laboratory in which we jointly invest, and everything is implemented in accordance with market rules." As for the shares, half of the family, no one takes advantage of anyone. Moreover, Shenzhou Technology guarantees that it will not make basic telecommunications products, and will only make civilian products in the future. β
Mr. Ren was a little embarrassed and said, "I'll go back to a meeting to discuss." β
Song Weiyang is not in a hurry, because he only invests money in the research and development of 3G and has no income, Huawei has wanted to sell HiSilicon many times, and even packaged and sold the mobile phone business. In the end, it was not because Mr. Ren was far-sighted, but because he couldn't find a buyer, and no one was willing to take over the money-losing goods, Huawei could only survive until the 4G era.
Song Weiyang wants to merge the chip divisions of Huawei and Shenzhou, and the reason is very simple, he has taken a fancy to Huawei's top technical talents.