Alcatel-Lucent wins $6 billion Verizon Wireless deal

Verizon Wireless this week awarded Alcatel-Lucent a $6 billion, three-year contract to supply network equipment, software and services for Verizon Wireless' network expansion and upgrades.

The announcement comes as the wireless industry convenes in Orlando this week for the CTIA Wireless 2007 conference and trade show.

The deal will help Verizon Wireless further increase the coverage and capacity of its BroadbandAccess network, which is based on CDMA2000 1xEV-DO Revision A technology. It will also allow the carrier to introduce services based on its Advances to IP Multimedia Subsystem (A-IMS) project, such as VoIP, push-to-x, and mobile video telephony.

A-IMS is Verizon Wireless’ strategy to enhance the IMS work being undertaken by the 3GPP and 3GPP2 industry groups. Verizon Wireless will incorporate A-IMS compliant elements of Alcatel-Lucent’s IMS product portfolio under this agreement.

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Verizon Wireless this week awarded Alcatel-Lucent a $6 billion, three-year contract to supply network equipment, software and services for Verizon Wireless' network expansion and upgrades.

The announcement comes as the wireless industry convenes in Orlando this week for the CTIA Wireless 2007 conference and trade show.

The deal will help Verizon Wireless further increase the coverage and capacity of its BroadbandAccess network, which is based on CDMA2000 1xEV-DO Revision A technology. It will also allow the carrier to introduce services based on its Advances to IP Multimedia Subsystem (A-IMS) project, such as VoIP, push-to-x, and mobile video telephony.

A-IMS is Verizon Wireless’ strategy to enhance the IMS work being undertaken by the 3GPP and 3GPP2 industry groups. Verizon Wireless will incorporate A-IMS compliant elements of Alcatel-Lucent’s IMS product portfolio under this agreement.

In addition, the agreement calls for Alcatel-Lucent to enhance Verizon Wireless' existing CDMA2000 1X network.

The arrangement calls for existing Alcatel-Lucent-supplied packet switches to be upgraded to support IP soft handoff and Transcoder Free Operation, and the Alcatel-Lucent 7750 Service Router will also provide IP routing and Ethernet aggregation. Verizon Wireless will also use Alcatel-Lucent’s MDR 8000 digital microwave radios, optical cross-connects LambdaUnite and 1671 Service Connect, and the Metropolis DMX product family, which will provide bandwidth management and mobility traffic backhaul.

Alcatel-Lucent is also providing network support services such as network integration, installation, repair and maintenance.

The deal builds on an existing relationship between the two companies.

"We believe the contract is more of an extension of existing business as [Alcatel-Lucent] does about $2 billion a year with Verizon Wireless," states UBS Warburg analyst Nikos Theodosopoulos in a research note.

Theodosopoulos also notes that Alcatel-Lucent could now be the primary IMS -- or A-IMS -- vendor to Verizon Wireless.

"The language on IMS implies Alcatel-Lucent has won Verizon Wireless IMS business," he states in his note. "This suggests that Alcatel-Lucent continues to be well positioned for being an IMS vendor for Verizon Wireless. Verizon has an RFP out on IMS where we believe [Alcatel-Lucent] and Siemens are on short list."

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