Hon Hai to move beyond iPhone Assembly to AI and Big Data

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Hon Hai Precision Industry Co. Chairman Terry Gou, best known for assembling Apple Inc.’s iPhones, plans to increase its focus on artificial intelligence and big data over the next few years as he seeks to transform the contract manufacturer into a more influential force in the global technology industry.

Gou, at an annual gathering in Taipei for employees and family members Sundaarty, said the company has a great deal of work to do through 2020 to adapt to the sector’s new realities. He will expand investments in AI, automation and the Internet of Things to position his companies even more centrally in the tech supply chain.

The comments came a day after a Hon Hai unit, Foxconn Industrial Internet Co., said it expects to spend 27.3 billion yuan ($4.3 billion) on next generation projects and hold an initial public offering in China. Those efforts will include cloud computing, IoT solutions, AI manufacturing and fifth-generation wireless technologies, the firm said in an application prospectus on the China Securities Regulatory Commission website. Hon Hai is moving into sectors beyond pure electronics assembly as growth in the global smartphone industry sputters.

At the same time, Gou has met with U.S. President Donald Trump and agreed to build a $10 billion display factory in Wisconsin. In July, the state’s governor and Gou signed a memorandum of understanding that calls for up to $3 billion in government assistance and the sale of at least 1,000 acres of land.

Hon Hai’s annual gathering is a chance for Gou to speak about his priorities to employees and the media. This year, he put an emphasis on how their company will manage technology trends touching virtually all corners of the industry.

Hon Hai and its affiliates took control of cash-strapped Japanese display maker Sharp Corp. in 2016 and pledged to revive the hundred year old brand. The company has reported five straight quarters of net income and is expanding into new technologies such as high-resolution televisions known as 8K, which the company says display images 16 times the resolution of HD TVs.

Sharp President Tai Jeng-Wu said Japan is entering the 8K era and demand will rise with more content.

Gou said his company is in discussions about a possible joint venture with Red Digital Cinema, a U.S. company that makes high-end film cameras that shoot up to 8K images. The effort may make such gear more affordable for professionals and the general public.

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