H3C Technologies Co Ltd, the communications equipment maker based in Hangzhou, capital city of Zhejiang province, will move into big data services after being bought by Chinese firm Unisplendor Corp Ltd.
The former Hewlett-Packard China subsidiary has focused on research and development of information technology infrastructure. But now the company is making big data, a broad term for data sets so large or complex that traditional processing applications are inadequate, a priority.
As part of the deal, Unisplendor also acquired HP's business in China, which includes server, storage and technology services.
In May, Unisplendor, which specializes in big data solutions, took a 51 percent stake in H3C.
"Even though people talk about big data from time to time in China, the industry is in its embryonic stage right now, but there is huge room of growth," Li Tao, vice-president of H3C, said.
"Unisplendor has acquired a number of companies from various business sectors in recent years, which make its business portfolio rich enough to help us grow."
H3C will also concentrate on smart home products in the second half of this year, according to the company's marketing and communications director Wan Ningna.
"It will be an extension of the business-to-business sector, which H3C has excelled in for years," Wan said. "But it does not signal a transition to the business-to-consumer sector.
"Still, it will be one of the most important investments H3C has made in recent years," Wan added. "
The smart home industry revolves around what is called the Internet of Things. This is usually an interactive network of appliances that are linked via the Internet.
"Our plan to strengthen this arm of our business is part of Unisplendor's strategy to cover the entire industry chain by connecting cloud, Internet and terminals," Li said.
H3C has a large overseas footprint. Its major clients include the United States-based Dreamworks Studios, Vodafone Group Plc, a United Kingdom-based multinational telecommunications company, and AMD, a global semiconductor firm in the US.
About 80 percent of its annual sales revenue comes from its overseas business in Europe and North America. But after the government launched its Internet Plus strategy and "Made in China 2025" plan, H3C will now move to increase its domestic market share.
H3C was rolled out in 2003 as part of a joint venture between privately owned Huawei Technologies Co Ltd and the US computer network product provider 3Com. Three years later, 3Com bought out Huawei's part of the business.
In 2010, HP China acquired 3Com and H3C became a wholly owned subsidiary.
This year, Unisplendor bought H3C from HP China and other key business operations with an estimated value of at least $4.5 billion.
"H3C has always been a key player in the overseas market, but not in China because it was owned by a foreign company," said Hu Xiangdong, research manager of the enterprise system and software research department at market consultancy IDC China.
"That put it at a disadvantage in the government-led Internet equipment purchase market here. But now H3C will finally be able to move into that market."
With nearly 5,500 employees in China, H3C reported sales revenue of 12.4 billion yuan ($1.99 billion) last year and a profit of more than 5 billion yuan. The company has two research centers in Beijing and Hangzhou, employing nearly 2,800 engineers.
