Siemens has invested $1 billion to create an independent subsidiary to focus on developing data and IP products amid speculation of a possible tie-up with 3Com.
The US business, known as Unisphere Solutions, has been created through Siemens' acquisitions of two startup companies, Argon Networks, a carrier class multi-service platform vendor, and Castle Networks, a vendor of voice and data boxes for emerging carriers.
The German manufacturer has also taken a stake in multi-service access platforms vendor Accelerated Networks and will combine these with existing relationships with Newbridge Networks and 3Com.
Siemens expects to sell the technology indirectly through its existing sales channels. Martin Clague, chief executive of Unisphere, said: 'We have a channel with 26,000 people not only through Siemens but also via 3Com and Newbridge. Products will originally be sold in the US and then made available in other parts of the world.'
But reports that Siemens' networking growth would include buying 3Com's carrier equipment business for $1.2 billion remained unconfirmed. However, the company said it anticipated 'further expansion' in the networking area.
'We have an extremely positive relationship with 3Com and will continue to explore significant steps forward,' Clague added.
Despite not buying 3Com's carrier business, Alan Pyne, a director of independent analysts Schema, believed it was only a matter of time. 'Everyone is trying to talk down the cost of IP shares at the moment. If the deal had gone through, Siemens would have had to pay at a premium rate,' he said.
Such a deal might not be too far away after 3Com announced that sales for the next quarter will be disappointingly low. Eric Benhamou, chief executive of 3Com, has attributed the blame to tighter control on releasing products into the channel.
'How quickly Siemens can buy 3Com can only help it to catch up with Lucent and Nortel,' Pyne stated.
Focusing on developing voice over IP and data over IP systems, Unisphere products are in beta testing and are expected to be launched during the summer. Siemens estimates the global market for data and internet technology is worth $60 billion and is growing at 17 per cent a year.
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