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3Com, Siemens in Enterprise Networking Pact

Networking giant 3Com Corp. and German telecom giant Siemens AG Wednesday announced a joint venture to develop network telephony and multimedia products.

Today's announcement is an extension of a previous 18-month alliance. The co-produced products are already under development and are slated for availably in 1999. They will provide enterprises with local area network services, including voice, video and data offerings.

The companies are jointly investing more than $100 million to start the venture. The union is aimed at providing both firms with leadership footholds in the emerging LAN telephony and gateway product market, which analysts expect to grow to more than $4.1 billion by year 2002.

The co-venture calls for:

  • Siemens call processing to handle telecommunications functionality and interworking software to ensure compatibility with enterprises existing telecommunications environments

  • 3Com's technology to be employed in a variety of networking solutions across the enterprise

  • Siemens to sell and market the venture worldwide and for 3Com to market the services worldwide through affiliates in 160 countries.

Products include multimedia exchanges for voice and data, LAN telephony gateways and ethernet phones and adapters packaged for small, medium and large businesses.

Initial applications for these products include voice-enhanced PC collaboration and conferencing, call centers for Internet-based retailers, and customer service help desks.

The products will be marketed under the Siemens HiNet and 3Com SuperStack II and CoreBuilder names. They will allow business users to place and receive telephone calls from their PCs or ethernet phones from wherever they connect to a corporate network.

They can also share rich voice, video and data applications across the network in real time. Data and multimedia files related to an incoming call can also be retrieved instantly.

Siemens and 3Com said it will form a separate staff for the venture. The initial staff will be comprised of 200 engineers from both companies.

"The joint venture brings together the best of breed talent, experience, core technologies and distribution channels to create the industry's richest set of convergence products and deliver them worldwide ahead of our competitors," said Eric Benhamou, 3Com's chairman and chief executive officer.

"Converged networking is the most exciting and fundamental change in networking since the Internet itself."

"Siemens will provide enterprise network customers with converged voice/data network solutions combining advanced LAN technology from the Ethernet market leader 3Com with benefits customers know and value from their PBX: feature-rich real-time communications and telco-class reliability," said Roland Koch, president of Siemens information and communication networks group.