In the rapidly evolving world of telecoms, the superfluity of new systems, new technology, and new acronyms to label them, can be baffling. 'Telecommunications networks are akin to plumbing systems: the pipes stand for bandwidth - the bigger they are, the faster the flow - and water is data, ' says John Marshall, Marconi Communications' regional director for the Middle East, one of the four core divisions of UK-based Marconi. He wants Marconi to be the plumber of choice for both the national service providers and the major corporations in the Middle East, providing equipment and design, build and operate services for the region's fast-growing telecoms networks.

'The crucial issue is bandwidth, and the need to increase the capacity of networks to allow more information to flow through the communication pipes at a faster rate, ' says Marshall. The region, along with the rest of the world, is confronted by an ever-increasing need for telecoms capacity that is simultaneously supply and demand-driven. From Marconi's point of view, there is a virtuous circle. 'There are four phases in the cycle that are all active at any one time, ' he says. 'There is the available bandwidth, the applications that are offered over it, customer appreciation of these applications and increasing demand for them, and the resulting need for more bandwidth. We provide the technology which enables the capacity to be increased.'

Although small in global terms, the Gulf and the Levant combined is a strong market, with an estimated pure telecoms spend - not including IT - of more than $2,000 million a year. And the market is growing fast.

Marconi Communications' business in the Middle East can be loosely divided into two areas. First, it supplies equipment and services for the transmission of voice and data by the national carriers: contracts have been won from all the monopoly telecoms operators in the GCC states. The company is a market leader in asynchronous transfer mode (ATM) switches, which organise data into packets and transmits them over networks; in synchronous digital heirarchy (SDH), which allows increasingly large data flows to be managed and transmitted; and in 'deep fibre access' - the expansion of fibre optic cabling further into the network's infrastructure - which expands bandwidth to the home and office.

'We're a key provider of optical networking equipment to the service providers of the region, ' says Marshall. 'We are the sole providers to Bahrain and Qatar, and among the main suppliers to the UAE, Kuwait and Yemen.' He says Saudi Arabia is the largest market by far, accounting for about half of the GCC spend, with an estimated demand for between $350 million-500 million a year of communications products of which $150 million-200 million is for optical networking.

Marconi also builds and manages networks for the enterprise sector - those corporate customers that operate independent and private internal telecoms networks (see box). Marconi is a key supplier to the enterprise network for Saudi Aramco, which comprises about 350 ATM switches serving 7,000 ATM nodes. Marshall estimates that the addressable GCC market for enterprise networking is currently worth about $250 million a year.

Talking revolution

To talk of revolution in the telecoms sector is to give a false impression: the explosion of supply and demand in recent years is one continuous revolution that has ushered in new technological solutions and will continue to do so. With demand for fresh carrying capacity growing at exponential rates, and the cost of installing new physical infrastructure high, attention has focused on developing new ways of pushing greater volumes of data through the existing networks. 'The world will change according to bandwidth, and people will soon be charged according to the bandwidth they buy, rather than by the connections, ' says Marshall. 'The Middle East will be part of the trend.'

Innovative technology is a hallmark of the industry. Not only have new ways been found to send bigger bandwidth over copper networks - the digital subscriber line (xDSL) family of systems - but the carrying capacity of fibre optic cables is also being multiplied. Dense wavelength division multiplexing (DWDM) allows a number of lasers to be carried by a single fibre optic cable, as opposed to the conventional single laser, dramatically increasing bandwidth without the cost of installing new fixed infrastructure. 'We're aggressively marketing DWDM in the region, ' says Marshall. 'And there will be a strong demand.' A contract should be awarded within the next two months by Bahrain Telecommunications Company (Batelco) for a DWDM starter pack, and the winner will be best placed for a string of subsequent, larger contracts.

Most telecoms companies agree that the future is internet protocol (IP) networking, which allows digital data to be transmitted over the internet's infrastructure. 'We're all pushing IP public and enterprise networks, ' says Marshall. 'And our audience is receptive: Etisalat [Emirates Telecommunications Corporation], Batelco and Saudi Telecommunications Company are all investigating it at the moment.'

It is no surprise that Batelco and Etisalat are among the parties most interested in IP networking. 'They are the most forward-looking of the regional service providers, ' says Marshall. 'They compete to be the most innovative in the Gulf and are fast followers of global trends.'

However, one of the most important global trends yet to be followed in the Gulf is deregulation. Liberalisation could bring choice to the customer, and more business to companies such as Marconi, but it will also necessitate radical rethinking of the structures of telecoms networks, and throw up the need for sophisticated regulatory bodies.

With World Trade Organisation (WTO) accession a live issue for most of the GCC states, and an issue that draws ever nearer, the urgency of finding answers to the questions posed is getting greater.

In industry parlance, Marconi will be offering solutions. Its communications division is one of a family active in the region. Marconi Mobile supplies terrestrial trunked radio (Tetra) equipment: last year, with its associate Jeraisy Computer & Communications, it won a contract to design, install and support an 800MHz digital Tetra mobile communications network for Saudi Aramco. Another group member, Marconi Services, acts as a multi-skilled consultancy with the capacity to design, build and operate telecoms-based turnkey projects, and it too has won major contracts in Saudi Arabia. It, along with the rest of Marconi, is hoping that more contracts will follow.