Cisco Urges Middle East Investment in Integrated Networks

Cisco Systems recently urged delegates at a conference of Arab telecommunications operators and service providers to invest in integrated ‘multiservice’ data and voice networks to help create the new ‘virtual highways’ of the future.

The New World of Communications and global competition is forcing many service providers to change or risk disappearing into obsolescence, according to Cisco Systems Chief Science Officer, Dr. Bruce Nelson who delivered the keynote address at today’s Middle East Service Provider Forum, which is taking place in Dubai from 6 to 8 April 1999.

“The new rules of the communications world are forcing changes at a pace
never seen before in the telecommunications industry,” said Nelson.
“Telecommunications organisations used to adapting to new technology
over a period of years, are now faced with a cost versus performance
ratio very similar to Moore’s Law in the PC industry, where performance
doubles every 18 months. As a result, operators costs per delivered
‘bit’ of voice or data traffic worldwide are going down at a rate of 100
percent per annum as multiservice networks come into operation.”

The Forum, which is being attended by officials representing Arab
telecommunications operators (telcos) and communications service
providers, focuses on new technologies that allow service providers to
deliver voice (telephone) services over public data networks, such as
the Internet. The telecommunications industry worldwide is undergoing
major changes as the total volume of data traffic being passed from
computer to computer over telephone lines, wide area networks and the
Internet exceeds the total volume of voice (or telephone) traffic for
the first time in history.

“Many forward-looking Middle East telecommunications operators are
already striving to close the technology gap between services available
in the region and those available in Europe and the United States,” said
Nelson. “In the ‘Old World of Communications’ operators and service
providers effectively had years to make strategic decisions, but in the
‘New World’ they are under pressure to review and make significant
policy decisions in a matter of months.”

“The revenue from telephone minutes is diminishing and the revenue from
data packets is increasingly where the subscriber demand is and where
the service provider revenue of the future will come from. Like so many
of the major technology advances of the last 30 years, new
communications technologies are breaking monopolies, creating new
businesses and reducing costs for the consumer.”

Cisco hopes that the Middle East Service Provider Forum will play a
significant role in highlighting the commercial opportunities that new
multiservice technologies provide today and help to show Middle East
telco how they can use these technologies to limit the negative impact
of falling oil revenues, economic slowdown and increasing international
competition in the communications industry.

“In the early eighties the Gulf states, in particular, realised the
importance of building national infrastructure and the ports, airports
and highways to carry goods and people and to promote trade. Today,
Middle East telcos have an opportunity to grasp this new technology and
build the new virtual information highways of the future,” said

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