Building a Broader Industry Ecosystem for Europe 4.0

I am very happy to discuss Europe 4.0 and imagine what Europe will look like in the future. I would like to share Huawei's views on Industry 4.0, a strategic initiative that will support Europe 4.0. Over the last ten years, the focus of digitisation has been on the service sector. Indeed, Internet has reshaped banking, retail, and many other sectors.  

In the future, the focus of digitization will shift to industries such as manufacturing. This is no doubt a huge opportunity for Europe. I believe that, enabled by Industry 4.0, Europe's strong manufacturing sector will continue to lead the world in the digital era. Industry 4.0 will develop at three layers: equipment, infrastructure, and applications. I would like to share my views on Europe's Industry 4.0 and discuss how Huawei can contribute to this initiative at these three layers.  

First, Europe should step up its efforts to make equipment smart and consolidate its leading position in manufacturing. 

Europe already has a solid foundation in equipment manufacturing. Certain developing countries have also seen rapid developments in their manufacturing sectors. However, the high-end equipment that their companies use still comes from Europe. European companies should therefore focus on going smart to consolidate their leadership in this field. Simply put, making equipment smart means installing sensors in a variety of industry and household devices, equipping these devices with operating systems and software, and then connecting them to networks. The commercial value of this move will be enormous. In industrial scenarios, there is even greater potential to make equipment smart. Let me give you an example. Smart equipment in a chemical factory will be able to detect polluted water, dust, exhaust gas, and other hazards in real time. This will help protect employee health, avoid accidents and waste, and ensure effective management. 

Here is another example. With smart power grids, equipment will be able to analyse supply and demand, and identify and report problems immediately. This will help avoid the huge waste and social impact caused by regional power failures. You see, making equipment smart will create incredible socio-economic value. In this regard, Huawei can supply highly adaptive network access modules and device operating systems for European equipment. This will efficiently connect Europe's unconnected equipment to the Internet.  

Second, Europe should continue to lead the world in next-generation communications standards, in order to create a functioning digital infrastructure for Industry 4.0. 

Today, the 4G standards advocated by Europe are very popular globally. I believe that it has the capacity to – and should continue to – lead global next-generation communications standards to adapt to the development of Industry 4.0. Communications are no longer limited to people-to-people connections – they now include connections between people and things, and between things and things. Over the next ten years, connections will focus on things and things, especially in mobile scenarios. With regard to communications infrastructure, we need to consider the surging demand for connections, capacity, and traffic. Existing technologies cannot meet this demand, so we must move towards 5G. 

We believe that 5G can support 100 billion connections, a user data rate as high as 10 Gbit/s, and an ultra-low latency of 1 millisecond. This means that all industry needs will be satisfied, and that the transportation, manufacturing, and energy sectors will be efficiently connected. Then, a digital Europe will come into being.

Actually, many organizations such as METIS and 5GPPP have been established in Europe to drive 5G development. Huawei has invested heavily in 5G and has actively participated in the EU's 5G initiatives. Not long ago, we established the 5GVIA tested in Munich, Germany. Today I am happy to announce the establishment of our new European Research Institute. The institute will be located in Leuven, Belgium. It will coordinate the work of the 18 R&D sites in eight European countries and will contribute to boosting 5G research and Horizon 2020 research objectives. We hope that our vertical industry partners can further support 5G initiatives to put 5G standards into commercial use and create an environment conducive to innovation.  

Thirdly, we expect European companies to achieve greater success through collaboration at the application layer. 

The application layer is where the value of Industry 4.0 resides. It is also where European companies will face challenges during their transformation. To enable Industry 4.0, they will need to make full use of their data assets. As its automotive, energy, machinery, and equipment companies complete their digital restructuring, I believe that Europe will build strong application development capabilities within these vertical industries. 

Yet, challenges remain because user demand is always changing. Today, most drivers trust the quality of European cars. In the future, however, they will probably raise new concerns: Can European cars provide higher levels of safety? Can services like assisted driving and adjustable insurance be provided? 

To bring in innovative ideas and integrate resources from a broader industry ecosystem, European companies should open up, collaborate more with other industry players around the world, and turn competition into cooperation. Europe needs to develop leading vertical industry apps, and bring them to the global market. For a long time, Huawei has worked closely with Europe's software developers and operational technology providers to build a healthy industry ecosystem. 

At this year's CeBIT, we signed an MoU with Fraunhofer on joint research and development of Industry 4.0 scenarios. We also signed an agreement with SAP on Industry 4.0 cooperation to deliver ICT solutions for transportation, oil and gas, manufacturing, and other sectors.  

To conclude, Industry 4.0 will be a huge and complex ecosystem that relies on information made available in real time through networks. To realize Industry 4.0, all stakeholders must form alliances and work together. This includes equipment manufacturers, ICT solutions providers, research institutes, and governments. 

We will leverage our leading ICT solutions such as mobile broadband, Big Data, and cloud computing to innovate jointly with our European partners. We believe that we can contribute greatly to the development of Industry 4.0, and help this continent become a leading market and leading supplier.   

* Guo Ping is Deputy Chairman & Rotating CEO of Huawei Technologies.