Potevio identifies new Middle East opportunity

Potevio’s regional CEO, Dr Alie Saad, talks to GITEX Times about his plans to launch the Chinese giant in the region.

  • E-Mail
By  GITEX Times Staff Published  November 19, 2006

|~|saad200p1.jpg|~|Saad: “My hope one day is that we develop the ability to do many joint ventures, and actually start manufacturing and developing telecoms products here in the region.”|~|Gitex Times: What are Potevio’s origins and pedigree in the telecoms and networking field? Alie Saad: China Putian is the predecessor of Potevio. Potevio has around 90 joint ventures, about 50 subsidiaries – its strength is in the manufacturing field. One of the components it manufactures is cellphones; of every nine cellphones in the world, three are made in China; of those three, around 1.2 of those are manufactured by Potevio. It manufactures for Nokia, Sony Ericsson, Panasonic – it has joint ventures with these vendors, and the JVs actually do the manufacturing. GT: Why have people not heard of the company before now? AS: When people hear about Potevio, they may be using its products every day, but they don’t know about the company because they have been behind the scenes. You see Potevio’s products as Nokia, Sony Ericsson, and so forth. But now Potevio is the new brand name; the word comes from certain syllables: the first – ‘Po’ – is from potent; ‘te’ is from telecommunications; ‘vio’ is from vitality and life. GT: What are Potevio’s main areas of operation? Is it mainly manufacturing? AS: The manufacturing side is only one side – the other aspect is research and development. Potevio has around 53,000 employees, manufacturing and designing products raging from intelligent transport systems, all the way to 3G equipment in the case of the JV with Nokia – last year Nokia signed an agreement with Potevio to develop and market 3G equipment. Potevio has factories all over China, producing these ranges of equipment. GT: What is Potevio’s revenue? How does this break down across the different sectors? AS: In 2003, the company reported revenues of US$7.3 billion – a good portion of it came from manufacturing telecoms equipment. You cannot break down Potevio’s revenue into areas like telecommunications, enterprise, and so on; the way the company breaks down the revenue is related to the manufacturing side – when companies like Nokia or Panasonic sell their products, the revenue that comes into Potevio, you don’t know what’s going where. GT: What will you be focusing on in the Middle East? AS: Unlike any manufacture of telecoms equipment, one of the things we’re trying to push out is to try and help the nascent industry here. We want to help people in this area who are developing telecoms products, help them to do the R&D and help them produce the systems. So in addition to selling our products, we are going to make a service out of manufacturing. If you look at the Middle East in general, the region is one where it is craving real technology environmet, where you try to diversify from the oil economy to the new economy. At Potevio hopefully we can enable that shift slightly. We’re looking to manufacture, do development, do R&D, all in the Middle East. And with the backing of the Chinese government, which is huge, we can enable a lot of these things. GT: What is your long-term vision for Potevio’s operations in the Middle East? AS: My hope one day is that we develop the ability to do many joint ventures here, where we can actually start manufacturing and developing telecoms products here in the region – this is one of our pushes. Any telecom vendor can come and tell you ‘We have this, product, this product, this product’- and we have those products. But in addition, we want to be different – we want to help regional enterprises gain the ability to develop these products themselves, from not only the hardware, but the software side. GT: Why focus on the Middle East in particular? AS: The Middle East is unique – if you take the Middle East and North Africa, it’s a very large region. If you look at statistics and forecasts, you’re looking at a population of around 400 million people from Pakistan to Morocco, within three to four years. But if you look at the environment, it’s very different; you can go to certain countries, and the evolution of the telecoms network there is very nascent – they’re still talking about deploying voice lines. If you go to Saudi Arabia, you’re seeing very advanced telecoms networks going in place – the focus there is now on value-added services, not the infrastructure. Potevio can span the entire range, from the very nascent initial telecoms networks, to the very advanced systems such as 3G, NGN, all of this put together.||**|||~|saad200p2.jpg|~|Saad: “The changes in China and the growth within China have highlighted the fact that China itself is one country that can now compete on a level playing field.”|~|GT: Will Potevio be working to address the training and skills issues in the Middle East? AS: Potevio has many universities and learning institutes associated with it; it would also be of interest to us to try and see what affiliations we can build here, to try and develop and build a technology background with the universities in the region. It’s very early for this to happen, but with time we would like to see it. This is all good fluffy stuff – bottom line, we also want to sell products. GT: How does Potevio’s business break down? AS: Potevio effectively has five verticals: systems and networks – 3G systems, fibre, carrier-class systems; consumables, such as terminals, SIM cards, scratch cards, smart cards, banking systems, security systems for fraud prevention, and so on; the third side is basically ancillary equipment – things like optical distribution frames, fibre cable, microwave links; then there’s value-added services, such as software; the fifth side is the enterprise. What we call the enterprise is different to what other companies call the enterprise – we include banking systems, ATM systems, security – end-to-end enterprise. GT: Do you see companies such as Huawei as having lead the way in establishing Chinese industry and technology as a force to be reckoned with? AS: The perceptions of China have changed in the past year, not just because of Huawei – the changes in China and the growth within China have highlighted the fact that China itself is one country that can now compete on a level playing field. So it’s not only Huawei – Huawei is only one of many, many companies that are coming out of China now. And Huawei is not our competitor – because Potevio is such a huge entity, made up of so many divisions, some divisions will compete, and others will compete with ZTE, others with banking, or SIM card, or cellphone providers. To give you an example; the software which handles the CDMA network, co-developed with Potevio, currently sits on a network which handles 40 million people. So when you start talking about 40 million people, and you add up all the subscribers in the Middle East, then you start competing. This is the experience that is basically being brought to this area. GT: Potevio will be making its debut at Gitex this year – will you have any particular focus? AS: At Gitex and GULFCOMMS, when you look at the stand we’re putting out, we’re going to exhibit the 3G products which we’ve developed jointly with Nokia, we will exhibit base station repeaters, we will exhibit edge products, cellphones, SIM cards, microwave dishes. What we’re trying to demonstrate is that Potevio is an end-to-end solution, not only for products, but also for services – we will productise our capability to manufacture, and help develop the nascent industry that is here. When you look at the push into the region, you’re looking at a push for the low-hanging fruit to produce as much revenue as possible to begin with. GT: Many major regional operators will be at GulfComms – what does Potevio have to say to them? AS: Potevio manufactures for Nokia and so forth – these are products that people will recognise. But Potevio also manufactures products for any company. Here in the Middle East, you’d be very hard-pushed to find a handset with the Etisalat logo, or the Saudi Telecom logo – I think the reason for that is the fact that in this area, where you’ve had monopolies for so long, there’s no point subsidising handsets. Now you’re seeing deregulation taking place, these guys are going to compete among themselves, and we will start seeing what they will do to differentiate themselves, for instance in Saudi Arabia between Mobily and Al Jawal. You’re going to get to the point where they have to subsidise and start giving away phones; in this case, it is nice to make them branded and distinctive – where will they turn to? This is where we can help develop products that are suited for this region – Arabised phones and so forth. In South America, you see phones that are very different than those here, so we can try to Arabise and make the products regional. GT: Finally, how do you think people will see Potevio here in the Middle East? AS: I think one has to see and expect the best from Potevio, coming out here – I think that people will be very pleasantly surprised by the quality coming out of Potevio. We are not your everyday vendor, we are very different from everybody else, simply because of our breed – our evolution was very, very different to other vendors’.||**||

Add a Comment

Your display name This field is mandatory

Your e-mail address This field is mandatory (Your e-mail address won't be published)

Security code