Lucent Bell Labs in China -- An account of personal experience

1. Lucent Bell Labs in China -- An account of personal experience • Lucent & Bell Labs • Bell Labs in China • LT R&D Center in Nanjing • Challenges Dr. Ho, Jenlie (何仁立 博士) General Manager Lucent Technologies Nanjing jentto@lucent.com

2. About Myself Bell labs 1982 • MTS, Technical Manager • Switching Systems : 5ESS switch, ISDN, Packet Switching, Operating System, Call Processing • Globeview switch: ATM, Call Processing, OAM, Bell Labs in Shanghai 1996 • R&D Director • Advanced Technologies : DSP, Speech Processing, ASIC, Digital phone. VOIP. Bell Labs in Beijing 2000 • R&D Managing Director • Lucent Mobility: GSM BST/BSC, CDMA/CDMA2000 Call Processing. Bell Labs in Nanjing 2003 • R&D Managing Director & General Manager • Lucent Mobility: 3G, CDMA/CDMA2000 OAM

3. Lucent and Bell Labs • Bell Labs was Bell Telephone Laboratories in Bell Systems and AT&T era. Had always been the R&D arm of the parent company since 1925. • Lucent Technologies was formed in Oct. 1996 when AT&T separated into three completely independent companies. Systems and equipment business along with 85% of the Bell Labs moved into Lucent. • Lucent Technologies (China) is the holding company handling all Lucent’s business interests in China.

4. Lucent and Bell Labs Bell Labs R&D Architecture • Basic Research • Advanced Technology • Product Development • 10% of Bell Labs personnel --- Central Labs • 90% are involved in a variety of product development projects

5. Bell Labs in China Motivations China Market potential – close to our customers Plenty supply of good talent at lower cost Manufacturing and sourcing activity in China – R&D complementary Serve Lucent customers better Government support

6. Bell Labs in China • 2/93 MOU between AT&T and Chinese SPC • 11/94 Pudong project MOU between City of Shanghai & AT&T • 3/97 Cooperation MOU with SEDC signed --------------------------------------------- • 5/97 Bell Labs China Establishment & first group MTS onboard for US training • 10/97 President Jiang visit Bell Labs HQ in NJ • 11/97 Shanghai BLC operational • 3/98 Beijing BLC operational • 3/00 BL Research formed in BJ---------------------------------------------- • 6/00 BLC Wireless Lab established in BJ • 4/02 Lucent Mobility R&D center established in BJ • 8/03 Lucent Mobility R&D Nanjing formed for 3G projects

7. LT Mobility R&D Nanjing Center • 05/24/03 : Final location selection and office planning. • 08/03/03 : Phase 1 staff Report-to-work (90) • 09/17/03 : Grand opening ----------------------------------------------- • 12/2003 : 1st software delivery by Nanjing team to LT 3G product development. • 03/04 : HWI team established • 07/15/04 : Phase 2 staff all on-board (+110) • 10/08/04 : Phase 3 recruiting started (+100 by 7/05) • 11/05/04 : Nanjing LT Telecom Co. established

8. A Few Things About Nanjing • City history goes back 2470 years, capital of 10 dynasties, has long been a culture center of China. • Capital of JianSu province, city population 6.4 million. 20 million in one hour drive circle. Key city in Yangzhi Delta. • GDP > $2000. Annual Increasing 12%.. Top ten city in China in terms of economic development • Among Top 3 in Education and R&D, with BJ and SH. 48 universities and colleges, 430k students, annual graduates 100k. • Nanjing graduates are considered high quality, lower wage, all fields, relatively more stable. • Major industry: Petrochemical, Auto, Electronics & IT. • Strong interest in further developing the Software industry, supported by many favorable government policies & practices. • Lucent competitors presence: Motorola, Ericsson, Hua Wei, Siemens, ZTE. For LT : Human Resource, Gov Support, Market opportunity

9. LT Mobility R&D Nanjing Center Nanjing Center Staffing Profile

10. LT Mobility R&D Nanjing Center Nanjing Project Direction • 3G Technology & product development • Mobile Switching Center (MSC, ECP, BSC) Software components development for Lucent’s global 3G products • Technical Support (ECP SW, BST HW) for Lucent’s customers and business teams in China • Outlook for Nanjing Center • Growing R&D team in size (300 staff and beyond) • Expanding development scope, new project, HW.

11. Challenges • Fast growing organization and staff training • Build organization and grow local management atthe same time • Integrating with global R&D community • Capital investment & Software Co • R&D Lab equipment & Import tax • Culture & management style

12. Thank you

13. Bell Labs Awards • Eleven Nobel Laureates • 1937 : Wave Nature of Matter, (Clinton J. Davisson) • 1956 : Transistor (John Bardeen,Walter H. Brattain, William Shockley) • 1977 : Local Electronic States in Solids (Philip W. Anderson) • 1978 : Radio Astronomy (Arno A. Penzias, Robert W. Wilson) • 1997 : Optical Trapping (Steven Chu) • 1998: Fractional Quantum Hall Effect 1998 (Horst Stormer, • Robert C. Laughlin, Daniel C. Tsui) • 9 US National Medals of Science • 8 US National Medals of Technology • 40,000+ patents since 1925, ~ 4/working day now • In the past few years important achievement by Bell Labs include - The first all optical router - Software that makes web content accessible by telephone - A record for the fastest transmission of data over fiber - A new material that may be useful for working plastic semiconductor chips

14. Bell Labs in China Other Considerations • Global R&D & Localization • Multi location • “R” before “D” • Software first than Hardware and System • Pre-sales support and product support • Intellectual Property Protection • US laws and regulations :Export Control, FCPA

15. LT Mobility R&D Nanjing Center Recruiting Process • Campus + Market recruit • Channel: job ads (newspaper, internet, internal referral, BBS), campus visit agent (FESCO) • Campus recruit (Oct), Report-to-work (April & July) • Screening and interview 3,200+ 1,600 850 370 315 Resume Received Selected Candidates Interviewed Offers