Fujitsu Lands Monster Unix Deal with China Mobile

Published: June 26, 2008

by Timothy Prickett Morgan

Being on the same side of the planet in a massive IT deal helps, and it often helps quite a lot. This is one reason that, for instance, IBM has historically had such a huge presence in Japan since the 1960s and the mainframe revolution. But Fujitsu, NEC, and Hitachi guard their relatively local Asian/Pacific markets pretty tightly, and it is hard to win a lot of deals. Such is the case with a monster contract that Fujitsu just won at China Mobile Communications.

When you are a country that is as vast as China and has more than 1.3 billion people, you don't even think about running a copper (or fiber) phone line to people. You go straight to the cell phone, and skip all that expensive infrastructure, which is a beautiful thing. And that is what China Mobile Communications has done to serve its nearly 400 million cell phone subscribers-- the largest base of cell phone customers in the world, by the way. And similarly, when you are the IT department of such a large telco, you don't invest heavily in mainframe iron, but go straight to the biggest, baddest open systems that you can get your hands on to run the billing systems and support the applications that consumers expect to find on cell phone networks these days.

Over the next five months, China Mobile will be upgrading its billing system, network management system, and related application systems with a slew of Unix gear it is buying from Fujitsu. Over 200 of the company's Sparc Enterprise servers, including midrange machines as well as the high-end M9000 servers, will be the backbone of this new IT operation. The Sparc Enterprise machines, which were known as the Advanced Product Line, or APL, when they were in joint development by Sun Microsystems and Fujitsu for a number of years before shipping in April 2007, are really PrimePower Fujitsu-Siemens machines using the latest dual-core Sparc64-VI processors created by Fujitsu and running Solaris 10. (There is very little Sun hardware engineering in these boxes, and everyone knows it despite whatever Sun and Fujitsu-Siemens say.) The deal also involves over 30 of the Fujitsu Eternus 8000 Model 2100 disk arrays and licenses to PrimeCluster high availability clustering software for the Solaris platforms. Fujitsu says that the deal is worth about 2 billion yen, which works out to somewhere around $19 million.

Fujitsu has had to work pretty hard to get into position so it could close such big deals. In April 2006, it set up an application and platform solution center in Shanghai to push sales of servers, storage, and middleware. Thus far, the center has helped Fujitsu push over 2,500 PrimePower, Sparc Enterprise, Primergy (X64), and PrimeQuest (Itanium) servers and related storage into Chinese companies. The Chinese economy is obviously overflowing with manufacturers, distributors, and services companies that comprise its exploding economy, but many companies have piecemeal and klugey IT operations and are only now getting world-class IT systems installed. (The availability of electricity is an issue in many areas, which complicates the IT buildout.) In any event, China is something akin to the last frontier in IT, and it is a greenfield opportunity for IT players no matter where they hail from since China does not, as yet, design its own processors and operating systems and have indigenous companies doing big IT business. (Give it time.)

Also helping close the deal for Fujitsu was Linkage Technology Group, a 10,000-person IT consulting services company based in Nanjing that is a partner in the Shanghai application and platform center. Linkage Technology does application development, outsourcing, software training, and other related services, and by partnering with Fujitsu it was able to bring big iron to bear and help China Mobile upgrade its systems. The upgrade from its current systems (what China Mobile is replacing, the company did not say) will take approximately five months.

Incidentally, this is the first time that China Mobile has awarded a large contract to a Japanese IT supplier. It is always a matter of pride with all countries to try to pick the indigenous supplier, if there is one available.

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