When Askey was merged by ASUSTek in 2006, it planned to transform into the telecommunications sector for meeting the trend of digital convergence. Today, Askey is in the phase of digital transformation. “After years of investment, the company is expected to receive significant profit growth in the next year, as the upfront investment has laid the foundation for future profit,” said Mr. Alex Chou, the Special Assistant of CEO. However, the success of the new business requires the full support of stakeholders to bear the capital and financial pressure brought by the upfront investment.
 
How Askey Finds a Roadmap for the Next Five Years Amidst the Challenges:
Recently, Askey has invested in the development of new technologies, such as IoT, V2X (vehicle-to-everything), 5G applications, etc. and continues to strive toward achieving it profit recovery goals. Meanwhile, to meet customer demand, Askey has invested in a factory expansion in Vietnam, resulting in increased costs. Currently, Askey owns a solid client base, including several telecom operators. In addition, to response to the US-China trade war, it has relocated the manufacturing site from Wujiang in China to Vietman site I and site II, aligning with the global industry trend.
 
Thus, as Askey moves forward, if the anticipated profit growth materializes, it is likely to receive the promising returns over the next five years.
 
A Market Demand-Oriented New Business Model
Alex said the company had set clear transformation goals during the strategic transformation meeting. In the past, the company mainly provided customized products with an OEM/ODM sales model. But now, it is exploring new business models by becoming a solution partner, aiming to define the market, listen to customer’s feedback, and assist in the implementation of its transformation strategy, thereby extending its expertise and enhancing its competitive diversity.
 
While Askey specializes in telecommunications, it must enhance its capabilities to integrate more solutions to meet customer demands in the future. To seize more learning and growth opportunities, it has actively participated in various government projects for past few years, conducting several tests in different applications, including 5G Open RAN, satellites, and AI. These projects provide valuable chances for enterprises’ digital transformation upgrades. Askey aims to assess whether it replicate or expand solutions based on client needs through these field trials, enhancing its service quality with a market demand orientation.
 
“The transformation process requires continuous investment, resulting in relatively higher resource allocation for enterprises. During this nascent phase of the market, boosting short-term financial revenues necessitates more effort”, Alex said on the current challenging circumstances.
 
Global Market Deploying Development Strategy
Regarding production cost from relocating its manufacturing sites, Alex explained that transferring production lines from Wujiang to the two sites in Vietnam primarily responds to the US-China trade war and US customer demand for the risk diversification. Initially, the US government's push for domestic investment and friend-shoring strategies led Askey to evaluate the possibility of establishing manufacture in America. However, due to high costs, the company ultimately opted for more competitive Vietnam. Hence, Askey has established two sites in Vietnam for producing automotive and telecommunications products needed to the North American market. This investment is expected to yield strong production performance returns within 1 to 2 years.
 
Askey’s largest market is North America, accounting for over 50% of its revenue, followed by Japan and Europe. Alex said the market layout closely aligns with the company’s product strategy. As its significant investment in R&D and cutting-edge technology development, the European, American and Japanese markets are more receptive to new technologies and prioritize their adoption. This year, it showcased its leading technologies at exhibits such as CES, MWC, and Computex.
 
Alex emphasized that Askey possesses a long-term vision regarding technology investments compared to its peers. For instance, the company has assisted chip manufacturers in bringing products to market. Askey is also involved in the second phase of a forward-looking project under the National Science and Technology Council in Taiwan, helping to establish 4G private networks. In addition, it assisted in the setup of smart applications in Taipei Main Station. These early-stage investments have provided valuable insights into better market operations.
 
To enhance its global competitiveness, Askey is rooted in Taiwan while having a vision in global market changes. Alex stated as the US implements employment and infrastructure legislation with significant new technology investments, Askey will assess how to seize opportunities and collaborate with local partners on R&D initiatives. The goal is to gain early market insights to better understand customer demand and develop solutions that meet client needs. This strategy differs from the purely OEM mindset prevalent in the industry.
 
It believes that the development of technology products ultimately aims to create a better digital lifestyle for the public, encompassing smart cities, smart homes, and smart transportation. In this mindset, Askey recognizes the end-users' growing demand for cybersecurity. Even though operators have not fully acknowledged this need, it must still be addressed. Although it primarily serves the B2B market with telecom operators as its main clients, the end-users of digital living solutions remain crucial in the long run. Thus, the company continues to emphasize the importance of cybersecurity solutions, highlighting its distinct vision compared to its competitors.
 
Advocating for Open Industry Policies in the AI Era
With a global perspective, Askey suggested the government to promote market liberalization and fair competition at the “policy and regulation” rather than merely protecting existing industries. Meanwhile, industrial policies should be formulated with a clear direction to enable business to compete in the global market. Moreover, the implementation of these policies should be sustainable. In this AI era, the government should clearly define industrial policies and relevant measures, adopting an open attitude to ensure the effectiveness of policies and management rules.