Siemens Moves Globally, Upsets France

As company pursues new business initiatives world wide, it cuts deal with German labor unions -- to the consternation of France.

July 20, 2004

3 Min Read
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Siemens made progress on multiple fronts and time-zones over the past week. But not all was peaches and creme. The telecom manufacturer is in trouble for its efforts to increase the work week at two of its German factories to 40 hours -- up from 35. On the heels of reaching an agreement with its labor unions -- in which Siemens made it known that it would consider moving its operations elsewhere (most likely Eastern Europe) -- the company became embroiled in a political backlash from an unsual source: France. Junior budget minister Dominique Bussereau characterized the German company's negotiations as blackmail, and tried to keep any major manufacturers in his own country from trying the same thing. The threat and fear of outsourcing, it seems, is getting increasingly acute in Europe.

The fracas with France was offset somewhat by major initiatives in other parts of the world. Siemens announced new contracts with service providers in Europe, Canada, the Middle East and India.

In Europe, Siemens that announced that, along with Juniper Networks, it has been selected by BT to participate in trial deployments of BT's 21C (21st Century) network project.

The BT trials will include Siemens' Surpass HiG 1200 Trunk Gateway, a carrier-grade Voice over IP (VoIP) trunk media gateway that provides mediation between the core IP infrastructure of a next generation network and the existing circuit-switched network. The gateway will provide BT with a migration path to a converged voice and data network capability in an IP environment. Siemens also is delivering Juniper Networks' IP/MPLS routing technology, which provides service convergence and flexibility at the network edge along with the capability to operate multi-Terabit speeds within the core of the network.

Siemens also announced a "triple play" win with Shaw Communications, Inc., Canada's second-largest cable TV service. Siemens was tapped to deploy Surpass, its next-generation IP telephony network solution to support the rollout of digital telephony/VoIP as well as data applications.Siemens' Surpass voice-over-cable solution includes the Surpass hiQ softswitch"which functions as a call management server, the Surpass hiG trunking gateway, and the Surpass IP Unity media server. All three devices comply with the PacketCable interoperability standard.

Another recent landline network win for Siemens was a contract with Saudi Telecom Company (STC). The largest provider in Saudi Arabia, STC tapped Siemens IC Networks for purchase and implementation of optical networking equipment.

The initial phase of the contract calls for installing an SDH transmission ring which is expected to go live in the eastern province of the kingdom this month. Future plans call for the carrier to begin offering Ethernet-based data services and storage-area network (SAN) services through the network. These integrated technologies will be controlled by Siemens' TNMS software-based network management system. TNMS also will enable the Saudi carrier to migrate to a convergent, IP-optimized network.

On the mobile phone front, Siemens announced a deployment in India and a near-doubling of its investment in Symbian.

In India, Siemens won a $50 million contract with Bharti, that country's largest GSM mobile telecom provider, to optimize and provide operating services for the carrier's network. The agreement calls for Siemens to supply GSM core and radio network infrastructure as well as GPRS technology for a service footprint encompassing more than 150 towns. Siemens mobile also will operate the mobile network"the company's first mobile network operations contract in Asia.Positioning itself to take advantage of the coming market for "smart" mobile phones, Siemens Mobile boosted its ownership stake in operating system firm Symbian from 4.8 to 8.4 percent . Siemens is positioning itself to capitalize on the growth of the hybrid devices, which will incorporate the functionality of mobile phones, PDAs and personal computers. Siemens projects smart phones to comprise one-quarter of all mobile phone sales by 2008.

Other investors in Symbian include Ericsson, Nokia, Panasonic, Samsung and Sony Ericsson.

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