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July 28, 1988

SIEMENS PIPS NORTHERN TELECOM TO PHASE TWO OF BUNDESPOST X25 CONTRACT

By CBR Staff Writer

Northern Telecom Ltd has, as reported briefly (CI No 975) lost the UKP37m second phase of the Deutsche Bundespost’s X25 packet switched network contract to Siemens AG. The Canadian supplier installed the initial backbone net of the Datex-P project which was started in 1981, because it was the only company at the time with the technical know-how to pass the Bundespost’s stringent requirements. The decision will come as a blow to Northern Telecom, which has worked hard to protect its foothold in the West German market. It teamed up with domestic electronics giant AEG in 1984 and submitted a joint tender for Phase 2. Northern had proposed to update the original DPN 25 technology with its DPN 100 packet switch. The Datex-P contract has been subject to strong political pressures, with Canada’s Minister of Posts and Telecommunications threatening retaliatory action if Northern came away empty-handed. Siemens will install a brand new version of the EWSP packet switching system which is ISDN compatible, rather than add to the existing system and invested $30m in plant modernisation prior to the decision, to ensure immediate delivery. There is fierce competition between the two suppliers in the world packet switching market with Northern claiming a 24% stake and Siemens not far behind with a claimed 15% share. Datex is currently providing X25 data transmission to 30,000 users on a network built for half that number and the new extension should boost capacity to 100,000.

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