Cisco to Announce China Unicom Project

Networking giant Cisco Systems Inc. is expected to announce today it has been picked by China United Telecommunications Corp. to help China’s No. 2 mobile telephone operator expand its communications network.

San Jose-based Cisco said the expansion, valued at about $40 million, will include its routers, switches and access servers. The program will begin this month and will be rolled out over the next 12 to 18 months.

The program will extend China Unicom’s voice-over-Internet-protocol communications network to more than 321 cities across 30 provinces in China, Cisco said. The new contract is the expansion’s third phase, following two smaller programs that expanded China Unicom’s network to 30 cities over the last two years.

“The significance of the deal is ultimately less the dollar value than the overall size of the network,” said Alec Henderson, manager of marketing operations at Cisco’s voice training center.

He said only one in every six people in China has a phone connection, and the issue in that country is how to quickly build a large-scale phone infrastructure to accommodate the population.

China Unicom’s voice-over-IP network is the largest in the world, measured by size, capacity, traffic and number of cities reached, and it is growing, Cisco said. The Chinese operator has moved aggressively to expand its reach.