ECI Announces New Network Solutions and Global Services Divisions

Business Wire,  Oct 30, 2007  

Tags: Network Solutions Inc.

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-- Reorganization to improve customer focus and enhance product and operational efficiencies --

PETAH TIKVA, Israel -- ECI Telecom, a global provider of networking infrastructure equipment, today announced a business reorganization to align itself with key trends in the markets it serves. Convergence of technologies and the need to upgrade and build out networks are top of mind for communication service providers - ECI's customers. This reorganization is focused on three key areas - the creation of a Network Solutions Division, a Global Services Division, and expansion of the Global Sales and Marketing organization. These changes will enable ECI to rapidly meet the needs of the market by accelerating growth in its transport and access businesses, expanding its service offering, while improving operational efficiencies.

The new Network Solutions Division (NSD) is the result of consolidating ECI's two business units - the Broadband Access and the Transport Networking Divisions - into one single unit. By combining these divisions, ECI will improve customer focus and technology integration, enabling it to compete more effectively in a global and consolidating environment. Eyal Shaked, currently Executive Vice President & General Manager of the Transport Networking Division, will lead the new division.

In addition, ECI is announcing the creation of the Global Services Division (GDS), which will centralize and expand the Company's service portfolio, from delivery and installation to value-added advanced service offerings, such as managed services, turn-key projects and consulting services. This Division will continue to partner with carriers as they introduce new services and migrate to next-generation environments.

All sales and customer facing activities will now be consolidated into an expanded Global Sales and Marketing (GS&M) organization. This will allow us to better focus on our target markets as additional resources are shifted into the regions to further strengthen our customer-focused approach. With increased resources, regional managers will be able to engage their customers across the entire range of sales activities, including delivery, installation and ongoing value-added services.

"This is a natural next step for ECI, and is part of our strategy to remain highly focused and aligned with our customers' needs in the increasingly complex telecom sector. By focusing our business structure, we can capitalize on these opportunities with a streamlined and efficient organization, accelerating decision-making and time-to-market," commented Rafi Maor, CEO and President of ECI Telecom. "Our goal is to continue offering our customers a range of advanced products, solutions and services which enables them to maximize their current networks' performance as they migrate to next generation networks. By reducing total cost of ownership and increasing potential revenues from value-added services, we facilitate the transition to IP-based converged networks."

In line with market trends worldwide, and in a move to strengthen ECI's competitive position, the Company is also evaluating alternatives for the outsourcing of its supply chain, assembly and integration activities to a Tier-1 third party. If successful, ECI expects to finalize these negotiations during Q1 2008.

As part of this reorganization plan, ECI will immediately reduce its total workforce by approximately six percent by eliminating duplicate positions and operations and by introducing synergies across the organization.

About ECI Telecom

ECI Telecom delivers innovative communications platforms to carriers and service providers worldwide. ECI provides efficient platforms and solutions that enable customers to rapidly deploy cost-effective, revenue-generating services.

Founded in 1961, Israel-based ECI has consistently delivered customer-focused networking solutions to the world's largest carriers. The Company is also a market leader in many emerging markets. ECI provides scalable broadband access, transport and data networking infrastructure that provides the foundation for the communications of tomorrow, including next-generation voice, IPTV, mobility and other business solutions. For more information, please visit www.ecitele.com.

Certain statements contained in this release may contain forward-looking information with respect to plans, projections or future performance of the Company. By their nature, forward-looking statements involve certain risks and uncertainties including, but not limited to, product and market acceptance risks, the impact of competitive pricing, product development, commercialization and technological difficulties as well as other risks.

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