In an era when companies are aggressively manufacturing new telecommunications products for U.S. customers, Fairchild Industries is also building a marketing window in Europe.
The $1 billion Chantilly, Va., company with telecommunications, aerospace, commercial, industrial, electronics and space businesses has announced a joint venture with Alcatel Thomson Transmission Group, part of Alcatel Thomson, a $3 billion French telecommunications enterprise.
Fairchild Executive Vice President Emanuel Fthenakis spoke in French fashion when he called the arrangement an "entre' into the European market."
The arrangement lets the two companies pool telecommunications product lines. The French giant also will help market Fairchild earth-station products, used by private firms to receive and send satellite signals from space, in Europe.
The European telecommunications market traditionally has required years of cultivation by American companies, but Fairchild hopes Alcatel will be a shortcut.
"The international market is very large but it will be very difficult for us to penetrate that market," Fthenakis said. "It requires a lot of devotion. . . . Alcatel has done that and has a major position all over the world, and we get instant access to the international market.
"We have an opportunity to achieve a rate of growth in these rapidly expanding markets that neither company could likely achieve alone," Fthenakis said. Fairchild aims to make telecommunications a full one-third of its business in five years, he said.
Alcatel now holds a 40 percent share of the world market in certain digital telecommunications systems, Fthenakis said, and has a 70 percent share of France's telephone market.
In return for its marketing help, Alcatel Thomson will have access to Fairchild's product line and will use Fairchild's expertise to market its own satellite-based products and services, he said.
Each company is bringing into the venture a products unit and a systems and services unit, and each will have a minority interest in the other's new companies. Fairchild has created two new companies for the venture -- Fairchild Communications Products Co. and Fairchild Communications Networks and Services Inc.
Alcatel has created French-based Telspace S.A. and Alcatel Satellites Communications Systems. Telspace already is a leading supplier of earth stations, Fthenakis said. Alcatel Satellites will design international satellite networks.
Fairchild Communications Products, operating out of Germantown, Md., and Scottsdale, Ariz., will manufacture and market a full line of land and satellite-based products, and will modify Alcatel's products to meet North American requirements, he said. Alcatel's Telspace will offer similar products and services primarily to customers outside North American from its operating base in Paris.
Fairchild Communications Networks and Services, with its corporate headquarters at Washington Dulles International Airport, will market, engineer and service communications networks.