Siemens To Sell Dual-Network Wireless
Phone In Brazil
By TERRY WADE
of DOW JONES NEWSWIRES
SAO PAULO -- Germany's Siemens AG (G.SIE) will be the first
company to sell mobile phones in Brazil that allow callers to roam on
systems based on two different types of network technologies, the head of
the company's Brazilian unit said Tuesday.
The company will sell the phones as part of its plan to invest $700 million
over the next three years, Siemens' Brazil president Hermann Wever told
Dow Jones Newswires. With the investment, the company aims to capture
25% of Brazil's wireless phone equipment market, which includes handsets
and switching systems.
By the middle of 2001, Wever said, Siemens plans to introduce mobile
phones that can roam on networks based on Global System for Mobility,
or GSM, technology and Time Division Multiple Access, or TDMA,
technology.
Later, the company plans to offer phones capable of roaming on GSM and
Code Division Multiple Access, or CDMA networks.
All existing Brazilian cellular networks run on either CDMA or TDMA
technology at the 800 megahertz frequency, while Brazil's new GSM
networks will run at the 1,800 megahertz frequency.
Siemens hopes to annually increase combined sales of dual network and
single network handsets by two million units through 2003 in Brazil, where
the company expects industrywide mobile phone sales to hit 12 million in
2000.
Siemens Set To Become Major Brazil Mobile Player
When Brazilian telecoms watchdog Anatel in June decided to license new
wireless licenses using GSM technology, critics complained it would lead
to massive interconnection problems between CDMA/TDMA networks
and new GSM systems, as few phone makers were thought to be
interested in spending heavily to develop phones capable of roaming on
both frequencies.
But by offering dual-network phones in Brazil, Siemens is proving those
critics wrong.
Siemens' bold move may help it meet its growth targets, which are
ambitious considering the company has virtually no market share in Brazil's
wireless equipment market.
But Siemens has about 35% of Brazil's market for fixed-line phone
switching equipment and its strength in Europe's mobile phone equipment
market will certainly give it a boost when it goes against competitors in
Brazil such as Nokia Corp. (NOK), Ericsson (ERICY) and Motorola Inc.
(MOT).
While Wever declined to detail funding sources for the expansion plan, he
did say about $500 million of the company's investments will be used to
finance equipment sales to mobile phone companies. Wever added the
company expects to generate 40% of its Brazilian wireless revenue from
infrastructure sales, with the rest from handset sales.
The remaining $200 million of the investment will create about 500 new
jobs, Wever said. The company will boost its sales force by 150 jobs, with
the rest to be added at the company's telecom equipment manufacturing
sites in the southern city of Curitiba, in Parana state and Manaus, in
Amazonas state.
In Brazil, Siemens employs about 7,500 people in markets such as energy
products, industrial equipment, illumination and medical systems.
-By Terry Wade, Dow Jones Newswires; (5511) 813-1988;
terry.wade@dowjones.com |
