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3Com, Siemens nix joint venture plans

The networking firms end plans for a $100 million telephony venture for local corporate networks, but say they are still collaborating on networking technology.

3Com and Siemens have ended plans for a $100 million telephony joint venture for local corporate networks, but the two firms say they are still collaborating on similar technology.

The two firms announced plans for the joint venture last December and appointed a general manager and board members in March.

Last month, 3Com and Siemens decided against launching the joint venture, anticipating increased overhead costs from such a project, a 3Com spokesman said today.

Furthermore, the venture was considered unnecessary following a deal between the two firms this year to jointly market and sell each other's products, the spokesman said.

"We expanded our strategic relationship with Siemens AG to include a worldwide joint selling agreement," 3Com executives wrote in a recent Securities and Exchange Commission filing. "The strategic alliance may consider joint development of voice-related enterprise and carrier solutions. In light of the current strategic relationship, the two companies will not proceed with a previously announced joint venture," it said.

3Com and Siemens intend to pursue the same goals of the joint venture, but avoid the costs involved with a project of that nature, the spokesman said.

The venture was initially formed to build telephony products for local area networks, such as corporate offices. Products included multimedia exchanges, or gateways, for voice, video, and data traffic, and phones and adapters based on Ethernet networking technology. The venture also intended to incorporate 3Com's switching devices and network management software.

However, the two firms already offer products in the project areas, the 3Com spokesman said. For example, in February 3Com purchased NBX, a network-based telephone system that combines voice and data over Ethernet technology.

NBX technology is geared for the small business market, but 3Com and Siemens are currently in discussions for a possible NBX offering for larger businesses. "It's under discussion for Siemens to extend the platform," the 3Com spokesman said.

As for multimedia exchanges, or network gateways, 3Com plans to build voice, video, and data support into its existing line of products, including CoreBuilder switches, and compliment its product portfolio with Siemens' next-generation products, he said.