Made in the UAE

Dubai Investments backed network player Syscom begins manufacture of telephony products in the United Arab Emirates.

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By  Simon Duddy Published  January 23, 2005

|~|Bernhard-Iseman_m.jpg|~|“We are concentrating on the telephony sector because we have three years marketing experience selling telephony systems in the Middle East. We have worked closely with Etisalat in terms of what the products should look like and what they should be capable of.” - Bernhard Isemann, general manager of Syscom Emirates.|~|Network vendor Syscom plans to start production of telephony and network products in the United Arab Emirates (UAE) this month in a move that bucks the trend of manufacturing concentrating in the Far East. The company has been based in the region for three years, and has carried out significant systems integration work in Iran and other countries, but the manufacturing initiative represents a bold step for the company. “We have discovered something unique,” says Bernhard Isemann, general manager of Syscom Emirates. “In the UAE, we have competitively priced labour from the Asian market and also a fantastic business platform in terms of logistics, marketing and sales. In India and China, they have cheap labour but they lack the international platform for marketing,” he adds. The company is not only manufacturing for the UAE market but plans to sell products across the Middle East and also into Europe. For 2005, Syscom will focus on its PBX products, which are aimed at businesses up to 200 users. “We are concentrating on the telephony sector because we have three years marketing experience selling telephony systems in the Middle East. We have worked closely with Etisalat in terms of what the products should look like and what they should be capable of,” says Isemann. Syscom’s PBX products are hybrid systems, capable of working with internet protocol (IP), analogue and digital infrastructures. The company has stressed the importance of this as many sole IP solutions lack connections to traditional systems and most traditional systems lack the ability to connect to IP. The system also features Hot Bill, which allows managers to ascertain which users are making calls and how much the calls are costing in real time. Manufacturing in the UAE will present challenges but Isemann has pulled out three key factors he believes will give Syscom a great chance of success. The first and most important, according to Syscom, is having a strong local partner. Syscom is 60% owned by Dubai Investments, a UAE government investment group, which is in turn part owned by Sheikh Maktoum and Emirates Bank. The remaining 40% of Syscom belongs to the Raiffeisenbank financial institution, where Syscom started life as the bank’s IT and telephony department. “We have technology and expertise but you need to have a local partner who has influence and who can execute locally,” says Isemann. The deal is paying dividends with the company signed up to provide residential phones for Etisalat and also able to sell its products at its own sales counters with its own staff in Etisalt business centres. Isemann has also emphasised the importance of understanding the business culture in the Middle East and says the three years of experience the company has had in the region has stood it in good stead. “Also important,” says Isemann. “Is the company’s work culture. We have been fortunate to have European bosses that have given freedom to staff based in the region to execute business aims.” The vendor is hoping to gain original equipment manufacturer (OEM) business through the plant and also plans to begin manufacturing other product lines towards the end of the year, including its Datus routing and switching series, which features high level security and encryption and the Secure Box, which is a highly encrypted VPN router. “Mass market, high volume products are better served by larger production facilities in countries like China but industry specific niche kit is a good OEM opportunity for us in the Middle East and is something we will be looking to leverage,” says Isemann. Syscom claims that a key advantage of its encryption using products is that it is manufactured outside the USA and therefore does not have to share encryption keys with the National Security Agency (NSA) in the US. This can help in winning deals with government agencies that are sensitive about the American government holding their encryption details, claims the firm.||**||

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