Fujitsu looks to Chinese market

Company says the country can contribute to its expansion plans

BEIJING - Fujitsu Ltd aims to at least double its revenue from China in three years. The Japanese technology giant is planning to increase the proportion of revenue earned in overseas markets and to join the growing number of technology companies developing cloud-computing services.

Masami Yamamoto, president of Tokyo-based Fujitsu, told China Daily in Beijing that last year, the company's revenue in China was 110 billion yen ($1.36 billion), which was just around 2.5 percent of its global total.

However, as the company, often known as "Japan's IBM", is trying to expand overseas rapidly amid a slowing domestic market, China can play a significant role.

"The Chinese market is just a fraction of our worldwide business. Our official target is to double that in three years," he said.

"However, personally, I believe it is a conservative target."

He said that if Fujitsu can achieve 5 trillion yen in net sales, it is likely that China can contribute 10 percent of that.

Fujitsu has been trying to recover from the fallout of the global financial crisis. In the company's fiscal 2010, which ended on March 31 this year, net sales fell by 3 percent year-on-year to 4.53 trillion yen, although operating income grew by 41 percent to 132.5 billion yen.

Global expansion has become a key strategy for Fujitsu to achieve sustained growth.

It planned to increase the proportion of revenue from overseas markets to 40 percent in the near term, from 35 percent seen at the end of the 2010 fiscal year.

One area which Fujitsu is betting is cloud computing, which hosts computing services on the Internet and allows users to access the same applications and data from any location.

The US-headquartered research company International Data Corp (IDC) has predicted that China's cloud-computing service market will grow to $1 billion by 2014 from last year's $320 million.

The domestic research company CCID Consulting Co Ltd gave a more ambitious number: The market size could be 60.7 billion yuan ($9.38 billion) in 2012, up from 16.73 billion yuan in 2010. CCID's figures also included hardware sales.

Yamamoto said Fujitsu's focus in China is still product-centered, including computer servers, storage and personal computers, but, cloud computing, which is service-oriented, will be the key in the future.

The company has decided to invest $30 million in a data center in Foshan, Guangdong province, to meet customer demand for the service. The facility will be operational by the end of the year.

It is also in discussions with China Telecommunications Corp, with which Fujitsu has a key joint venture in Fujian province, on combined development of the cloud computing business, Yamamoto said.

Fujitsu is just one of the technology companies that sees cloud computing as a key to the future.

Hewlett-Packard Co launched a cloud executive briefing center in Tianjin on June 28, when its president and CEO, Leo Apotheker, visited China.

"Cloud computing and connectivity are redefining the way people live, businesses operate and the way the world works," said Apotheker at that time.

China Daily

(China Daily 07/07/2011 page15)