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Cisco Will Inject US$40 M Into Asian Business

American networking giant, Cisco Systems Inc. will pump US$40 million into its Asian business over the next 12 to 18 months.

"Despite the tough economic environment in Asia, our business in the region increased dramatically by 40 percent in 1998," said Bill Nuti, Cisco Systems president for Greater Asia. "We expect to see Internet traffic grow tenfold in the region by the end of next year."

"We are going to play across the board in every market," added Nuti.

"However, there are markets that are moving along further that present great opportunities," Nuti said, "Deregulation is more economically beneficial--doesn't matter if there is a right time or a wrong time. I do think it impacts the competitiveness of the markets."

In Asia, Hong Kong, Taiwan and Korea are liberalizing their telecommunications industries while India is doing the same for its ISP market. Asia makes up 10 percent of Cisco's business while the US is 59 percent and Europe is 30 percent.

Nuti believes that China will deregulate in 3 to 5 years

Cisco's expansion plans for Asia follow a year of solid growth in the region, according to Cisco representatives.

During calendar year 1998, Cisco Systems increased its staff by more than 250 percent in Asia to 600 and grew fiscal revenue 40 percent year-on-year, despite tough economic challenges facing the region.

Nuti said that Cisco was hot on the acquisition trail looking to snap up eight to 10 companies over the next year particularly those with voice technologies and possibly in Asia.

"We look at acquisition opportunities every day," he added, "looking for what products best fit Cisco."

"Survival in the New World of the Internet requires investment in building powerful, cost-effective communications infrastructure," he continued. "The New World communications platform is a multiservice network, based on Internet Protocol (IP), that will carry data, voice and video traffic."

"By combining the three traditional communications channels into a single, unified network, organizations will benefit from tremendous cost-efficiency, easy-to-manage networks and free voice calls that ride on other value-added services," said Nuti.

Cisco Systems plans to set up new regional offices in China and Vietnam to cater for growth in these new markets. The company will also open a Technical Assistance Center (TAC) in Korea and more spare parts depots in the region to enhance logistics support.

Responding to questions about Cisco's backing of Cyberport in Hong Kong, he said, "From our perspective the Cyberport is an excellent location. A great deal of intellectual capital will be there. We are investigating our options to play a role in that (the Cyberport)."