French telecom equipment maker Alcatel-Lucent SA has signed a three-year network expansion deal worth $6bn with Verizon Wireless Inc, the second largest mobile operator in the United States.
Verizon Wireless, a joint venture between Verizon Communications Inc and Vodafone Group Plc, announced on Monday that it had awarded the contract to Alcatel-Lucent to supply it with network equipment, software, and services to increase network coverage and improve the capacity of its broadband network based on CDMA2000 technology.
With this agreement Alcatel-Lucent continues to be Verizon Wireless’ primary network infrastructure supplier, the operator said. Specifically, the agreement means that Alcatel-Lucent will provide the infrastructure that will allow Verizon Wireless to move an all-IP network.
The deal will see Verizon’s CDMA2000 1xEV-DO Rev network upgraded to support services such as VoIP. Selected IMS services will be enabled through the addition of Alcatel-Lucent’s IMS platforms. Existing Alcatel-Lucent packet switches will 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.
Shares in Alcatel-Lucent rose 2.78% to $11.85 on the New York Stock Exchange on Monday on news of the deal. It will also have brought a smile to the face of Alcatel-Lucent boss Patricia Russo, who is battling to overcome opposition to the axing of 12,500 of its 79,000-strong workforce.
Last month the Paris, France-based company posted a fourth-quarter net loss of 613m euros ($796m), which it blamed on market uncertainty following the merger, the overall market decline especially in US carrier spending, and heightened competition.