In the process of Foxconn's transformation, in addition to upgrading its advanced manufacturing capabilities through the Industrial Internet, it is also actively exploring its own branded roads. The C-side dream continues.
In 1988, Chairman Guo Jianming of Foxconn Group visited Shenzhen Luohu District. After 8 years, Foxconn Longhua Technology Park began to piling. On June 8, 30 years later, Foxconn Industrial Internet Co., Ltd. formally debuted, landing A-share market, referred to as Industrial Rich. The value of the market was 390.6 billion yuan.
On the occasion of Foxconn’s 30th anniversary of its investment in mainland China, Mr. Gou said at the annual forum on June 6th that Foxconn has experienced a transitional period of the deep integration of the Internet in the “real economy + digital economy”, and his transformation direction for Foxconn planning is Industrial Internet, the attempt of industrial rich alliance will also play a leading role in the transformation of the parent company Hon Hai Group's other sub-groups.
Foxconn wants to become an industrial Internet platform company. The benchmark of the BEACON platform is GE's Predix. Comparing with the global industrial Internet platform, Chen Yongzheng, chairman of Industrial Fulian, said in an interview with a 21st Century Business Herald reporter: 'Industrie 4.0, It is industrial plus service that connects the equipment; the information service in the United States is the strongest and integrates with industry; our China's industrial manufacturing starts from the industry, and now industrial technology capability and manufacturing capacity are still in the beginning, and in the middle period, the industry upgrades. Automation requires robots, sensors, and intelligence to gather information. '
In the process of Foxconn's transformation, in addition to upgrading its advanced manufacturing capabilities through the Industrial Internet, it is also actively exploring its own branded roads. The C-side dream continues.
Industrial Internet B-side business
In fact, in the eyes of the Chinese public, Foxconn has almost upgraded from an ordinary large-scale enterprise into a cultural symbol. The impression of this cultural symbol is complex and vague. As the world’s largest foundry company, it has grown along with the iPhone’s dominance in the world. The public opinion on Foxconn's two issues has always been lingering, and will be accompanied by long-term lingering after a long time.
The first problem has evolved from a serious public relations dilemma into a lacy news - large-scale negative comments on Foxconn's sweatshops, which have a hard blow to corporate image. The second question is about Foxconn's industrial status.
The eager appetite for core technology rather than production technology after the ZTE incident has caused many public opinion critics of Foxconn to be impolite. Because to obtain a higher P/E ratio means more core competitiveness, but for now, Foxconn does not seem to have a higher ceiling, at least in the impression of the general public and investors.
Foxconn has never been single-line combat. Its products cover most electronic products such as mobile phones and computers in addition to chips. Today, the industrial Internet has become the new profit growth point Foxconn is looking for, which is also an upgrade based on the original manufacturing industry. Extension of business model. In simple terms, Foxconn will output unmanned factories, intelligent production capabilities, and industrial-grade system solutions to SMEs through its industrial Internet platform.
According to Chen Yongzheng, the layout of the Industrial Fulian is based on core data collection, extending to the cloud network layer, platform layer, application layer, etc. As early as 2015, the company began to develop BEACON, an industrial Internet platform, designed to pass the production line. The terminal sensor collects production data and equipment data, realizes comprehensive monitoring and prediction of manufacturing equipment and manufacturing processes, and collects, integrates, processes, classifies, and analyzes data.
Industrial Fulian has already deployed industrial robots, machine vision, numerical control machine tools, communication gateways, high-performance computing, edge computing and other intelligent equipment and underlying technologies, and multiple factories have realized light production. Chen Yongzheng stated: 'The company is active in each The company introduced the BEACON platform, established the Foxconn Industrial Cloud, and established unmanned factories throughout the country, with 60,000 industrial robots.
Zheng Hongmeng, general manager of Industrial Fulian, told reporters of the 21st Century Business Herald: 'The industrial Internet's future size is 500 billion US dollars, 82 trillion US dollars, is now 100 times the value of the consumer Internet, cut into 100 industries, more than any one The value of the consumer internet is big. '
On June 7, the Industrial Internet ushered in a dividend of a wave of policies. The Ministry of Industry and Information Technology released the Industrial Internet Development Action Plan (2018-2020) and the Industrial Internet Task Force's 2018 Work Plan. The action goal is By the end of 2020, the preliminary construction of the industrial Internet infrastructure and industrial system will be completed.
The industrial Internet needs stronger software capabilities and Internet strength. For Foxconn, which specializes in hardware manufacturing, hard and soft integration is a major challenge. On the other hand, Foxconn needs to shift more to consumers in order to truly increase its brand value. Industry, build a terminal brand.
After years of exploration
From the perspective of the existing business model, Foxconn has been an out-and-out To B company for the past 30 years, serving the downstream consumer goods company To C. Foxconn hopes to expand the industry chain into the consumer goods industry. This should be any Chinese OEM company. Dream, Foxconn is one of the few capable people.
Foxconn has several important nodes in the construction of its own brand. In April 2016, Foxconn acquired Sharp, but at that time, Sharp continued to lose money. Like other Japanese electronics companies in the golden age, they face fierce competition and forced transition. It is not In May 2016, Microsoft sold the Nokia brand and mobile software services to Foxconn. On June 5th this year, Japanese media reported that Sharp is negotiating with Toshiba and plans to spend approximately JPY 5 billion (approx. The acquisition of Toshiba’s PC division at a price of 45.5 million US dollars). If this acquisition comes true, Foxconn can enter TV, computer, mobile phone and three To C consumer products areas at one go.
In the TV field, Sharp has strength and after returning to the Chinese market in 2017, Foxconn launched 8k TVs with Sharp, also in order to enter the To C consumer industry. Recently, Sharp and Orui's Ledi robots have strategically entered the early education market. At the same time, Rich Connect, a Sharp agent, has also transformed into a Foxconn smart home internet platform, gradually moving to the front desk. Yuan Xuezhi, chief marketing officer of Foxconn Group, told 21st Century Business Herald reporter that Fulian.com has integrated Foxconn e-commerce providers such as Feihu.com. The platform is now not only responsible for the market operation and promotion of Sharp, Nokia, Infocus and other brands, but also joins different sectors such as services, content, and manufacturing.
In terms of mobile phones, Foxconn plans to build its own mobile phone brand in the short term. In the future, Foxconn hopes to become a consumer-oriented To C business. In the long-term, Foxconn hopes to reach out to consumers and acquire cutting-edge product business even if the mobile phone market declines. Capability, not waiting for other To C companies to develop products and hand them over to Foxconn, but Sharp's current share of the mobile phone industry is still low.
It is not an easy task to fight in the Chinese mobile phone market. The most important three links in the mobile phone industry are brand, market layout and production capacity in order of importance. Foxconn currently has only strong production capacity. Each company has its own capabilities. Advantages, such as Xiaomi's outstanding brand, are designed to drive products and rely on its founder Lei Jun’s personal brand endorsement to obtain low-cost brand promotion; Huawei is very strong in terms of market layout and production capabilities, and brand capabilities are at the forefront. Among the three capabilities, the most overlooked is the market layout, including online and offline channel placement, and marketing cost control. These require professional teams to deal with agilely. Even millet companies that are very agile to the market , In 2015 to 2017, they also planted a head-turn in the channel, and had to quickly change the bow and open the offline experience shop. It is rather funny that the production capacity is relatively second among the three, which is why Although the industrial enterprise has done its hardest job, it has the lowest profit rate.
The exploration of the terminal brand also means that there is a competing relationship between Foxconn and the customer. How to establish a brand barrier at the C-term and find a greater profitability breakthrough at the B-side. Foxconn needs to break.