Light Reading

AlcaLu in Talks to Sell Security Unit to Thales

Sarah Thomas
5/22/2014
50%
50%

Alcatel-Lucent is currently in exclusive negotiations with Thales to sell off its network security business to the defense giant.

Alcatel-Lucent said Thursday that it was looking to form a strategic partnership with Thales SA (Paris: TCFP.PA) in which they would provide their combined cyber security and communications security services to their customers. Alcatel-Lucent (NYSE: ALU) would also continue to develop new "advanced security features for its portfolio of IP and ultra-broadband access products," the company said in a release on the proposed deal.

Cyber security was a cornerstone of Alcatel-Lucent's Shift Plan, unveiled last year, and the company believes that by divesting to Thales it will be able to offer customers an end-to-end network security platform that combines its network knowledge with Thales's defense services. (See Alcatel-Lucent Unveils Shift Plan and Alcatel-Lucent Builds Future Around IP.)

The deal isn't official yet, as the two companies work out the terms of the deal, but this isn't the first tie-up between the pair. Alcatel-Lucent previously had a 20.8% stake in Thales that it sold off in 2008 as part of its effort to divest non-core assets. It had transferred its space assets to Thales in 2007 after Alcatel and Lucent merged. (See AlcaLu to Sell Thales and AlcaLu Seals Asset Sale Deal.)

This is the third of several planned partnerships that AlcaLu is forming under the Shift Plan. In February it sold a small stake of its small-cell business to Qualcomm Inc. (Nasdaq: QCOM) and struck a deal with Intel Corp. (Nasdaq: INTC) focused on cloud. (See Alcatel-Lucent CEO: We Can Go It Alone and Joint Qualcomm & AlcaLu Small Cells Due Mid-Year.)

"Alcatel-Lucent needs a significant play in network security to be competitive with where Nokia is already at and where Ericsson is clearly going now," Heavy Reading security analyst Patrick Donegan tells us. "This looks like it, albeit the devil will be in the details when they are discussed in briefings in the coming days."

In the meantime, check out the Show Site for Light Reading's Mobile Network Security Summit, which took place in London yesterday, for more on the state of mobile network security today. (See Slide Show: Mobile Network Security Strategies London.)

— Sarah Reedy, Senior Editor, Light Reading

(13)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
Page 1 / 2   >   >>
SachinEE
50%
50%
SachinEE,
User Rank: Light Sabre
5/31/2014 | 2:00:30 PM
Re: outsourcing security
@pdonegan67-I agree with the fact that ALU does not stand any chance of being competitive when it comes to the end to end network security space. I also think that the only way through which you can give ALU something that is more compelling is by selling out and allowing Thales to incorporate the ALU capabilities into their portfolio. I also agree with the fact that even though they may not own it, they will sell something that is much more compelling than what they normally offer.
SReedy
50%
50%
SReedy,
User Rank: Blogger
5/27/2014 | 1:23:56 PM
Re: outsourcing security
Good point, Mark. ALU acquired Kindsight in April 2013, so that is likely part of it.
MarkC73
50%
50%
MarkC73,
User Rank: Light Sabre
5/27/2014 | 11:19:06 AM
Re: outsourcing security
Thanks Sarah!  The Arbor partnership seemed to be an integration of IDS/IPS between Arbor's probes and the ISA MDA, which is a card in ALu's routers that can do specialized functions.  Kindsight, I can't recall if they were owned by ALu or not, but that's probably whats on the table.
SReedy
50%
50%
SReedy,
User Rank: Blogger
5/27/2014 | 9:42:19 AM
Re: outsourcing security
A deal hasn't been struck yet, so I think it's all under discussion. We'll hopefully hear more official news in the coming days, but the division include its cyber-security and network security assets.
MarkC73
50%
50%
MarkC73,
User Rank: Light Sabre
5/27/2014 | 3:03:40 AM
Re: outsourcing security
Specifically, do you know what this will do to the overall SROS strategy?  I was only familiar with ALu's partnership with Arbor and its pitch with Kindsight Security Labs.  Do you know how or what is being sold?  I'm going to assume what their plan to expand security visibility into their NMS (5620 SAM) is still on the table.  But their other partnerships might be what are being revamped
Mitch Wagner
50%
50%
Mitch Wagner,
User Rank: Lightning
5/23/2014 | 1:50:08 PM
Re: outsourcing security
pdonegan67 - I see your point, but AlcaLu needs to do a better job articulating its message. 

As of now, it looks like a major mixed message. 
pdonegan67
50%
50%
pdonegan67,
User Rank: Light Sabre
5/23/2014 | 11:35:22 AM
Re: outsourcing security
Yes I imagine those T&Cs are under discussion as we speak.
SReedy
50%
50%
SReedy,
User Rank: Blogger
5/23/2014 | 11:33:24 AM
Re: outsourcing security
Thanks, Patrick. That makes sense, although there must have to be some level of exclusivity to the deal, otherwise Thales could offer that end-to-end benefit to other vendors as well.
pdonegan67
50%
50%
pdonegan67,
User Rank: Light Sabre
5/23/2014 | 2:29:09 AM
Re: outsourcing security
I think the rationale goes something like this. Solo, with what they have internally, ALU stands next to no chance of being competitive in the end to end network security space.

By selling out, allowing Thales to integrate the ALU capabilities into their portfolio, and then positioning the bigger end to end Thales-owned story, ALU will have something a lot more compelling. They won't own it (to your point) but what they will have to sell will be (a lot) more compelling than what they currently have.

That looks like the rationale but it's difficult to verify that since it turns out they're not hosting briefings as the negotations are only now getting underway.
Mitch Wagner
50%
50%
Mitch Wagner,
User Rank: Lightning
5/22/2014 | 7:25:57 PM
Re: outsourcing security
I was thinking the same thing, Sarah. How does selling their security division make AlcaLu more serious about security, either in appearance or actuality?
Page 1 / 2   >   >>
Flash Poll
From The Founder
Last week I dropped in on "Hotlanta," Georgia to moderate Light Reading's inaugural DroneComm conference – a unique colloquium investigating the potential for drone communications to disrupt the world's telecom ecosystem. As you will see, it was a day of exploration and epiphany...
Between the CEOs
Affirmed Networks CEO: Digging Into NFV

5|28|15   |   40:26   |   (2) comments


Hassan Ahmed, CEO of Affirmed Networks, is making some big claims for his NFV startup. I sat down with him at the Light Reading HQ in New York City to get the skinny on what this Acton, Mass.-based startup is up to.
LRTV Documentaries
Cable Eyeing SDN for Headend, Home Uses

5|26|15   |   05:57   |   (1) comment


CableLabs is looking at virtualizing CMTS and CCAP devices in the headend, as well as in-home devices, says CableLabs' Karthik Sundaresan.
LRTV Documentaries
Verizon's Emmons: SDN Key to Cost-Effective Scaling

5|22|15   |   03:53   |   (0) comments


For Verizon and other network operators to ramp up available bandwidth cost effectively, they need to move to SDN and agree on how to do that.
LRTV Documentaries
Lack of Universal SDN a Challenge

5|21|15   |   04:51   |   (3) comments


Heavy Reading Analyst Sterling Perrin talks about how uncertainty about SDN standards and approaches may be slowing deployment.
LRTV Custom TV
Steve Vogelsang Interview: Carrier SDN

5|20|15   |   05:02   |   (0) comments


Sterling Perrin speaks to Steve Vogelsang, Alcatel-Lucent CTO for IP Routing & Transport business, about the new Carrier SDN-enabling Network Services Platform and the operator challenges it solves.
LRTV Custom TV
Carrier SDN: On-Demand Networks for an On-Demand World

5|20|15   |   20:52   |   (0) comments


Steve Vogelsang, Alcatel-Lucent CTO for IP Routing & Transport business, talks about requirements and benefits of Carrier SDN during the keynote address at the Light Reading Carrier SDN event May 2015.
LRTV Documentaries
The Security Challenge of SDN

5|19|15   |   02:52   |   (0) comments


CenturyLink VP James Feger discusses concerns that virtualization could create new vulnerabilities unless network operators build in safeguards.
LRTV Custom TV
NFV Elasticity – Highly Available VNF Scale-Out Architectures for the Mobile Edge

5|18|15   |   5:50   |   (0) comments


Peter Marek and Paul Stevens from Advantech Networks and Communications Group talk about their NFV Elasticity initiative and the company's latest platforms for deploying virtual network functions at the edge of the network. Packetarium XL and the new Versatile Server Module: 'designed to reach parts of the network that other servers cannot reach.'
LRTV Huawei Video Resource Center
Bay Area Spark Meetup 2015

5|14|15   |   3:54   |   (0) comments


Developed in 2009, Apache Spark is a powerful open source processing engine built around speed, ease of use and sophisticated analytics. This spring, Huawei hosted a meetup for Spark developers and data scientists in Santa Clara, California. Light Reading spoke with organizers and attendees about Huawei's code contributions and long-term commitment to Spark.
LRTV Custom TV
The Transport SDN Buzz

5|12|15   |   06:01   |   (1) comment


Sterling Perrin, senior analyst at Heavy Reading, speaks with Peter Ashwood-Smith of Huawei and Guru Parulkar of ON.Lab about the evolution of transport SDN and the integration of technologies.
LRTV Custom TV
Next-Generation CCAP: Cisco cBR-8 Evolved CCAP

5|5|15   |   04:49   |   (0) comments


John Chapman, Cisco's CTO of Cable Access Business Unit and Cisco Fellow, explained the innovation design of Cisco's cBR-8, the industry's first Evolved CCAP, including DOCSIS 3.1 design from ground-up, distributed CCAP with Remote PHY and path to virtualization. Cisco's cBR-8 Evolved CCAP is the platform that will last through the transitions.
LRTV Custom TV
Meeting the Demands of Bandwidth & Service Group Growth

5|1|15   |   5:35   |   (0) comments


Jorge Salinger, Comcast's Vice President of Access Architecture, explains how DOCSIS 3.1 and multi-service CCAP can meet the demands of the bandwidth and service group growth.
Upcoming Live Events
June 8, 2015, Chicago, IL
June 9, 2015, Chicago, IL
June 9-10, 2015, Chicago, IL
June 10, 2015, Chicago, IL
September 29-30, 2015, The Westin Grand Müchen, Munich, Germany
October 6, 2015, The Westin Peachtree Plaza, Atlanta, GA
October 6, 2015, Westin Peachtree Plaza, Atlanta, GA
All Upcoming Live Events
Infographics
Procera has gathered facts, stats and customer experience feedback from a survey of 540 users from across the globe.
Hot Topics
10 Alternate Uses for Tablets
Eryn Leavens, Copy Desk Editor, 5/22/2015
Bidding War for TWC Looks Likelier
Alan Breznick, Cable/Video Practice Leader, 5/22/2015
Charter Seals Deals for TWC, Bright House
Mari Silbey, Senior Editor, Cable/Video, 5/26/2015
Eurobites: Alcatel-Lucent Trials 400G in Czech Republic
Paul Rainford, Assistant Editor, Europe, 5/26/2015
Potholes Lurk in Indian Smart City Project
Gagandeep Kaur, Contributing Editor, 5/22/2015
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
On May 29th 10 AM ET, Steve Saunders, founder and CEO of Light Reading, will be drilling into the "pains and gains" of NFV with Saar Gillai, SVP & GM for NFV at Hewlett-Packard Co. (NYSE: HPQ) (HP). He has defined a four-step NFV model describing a sequence of technology innovation. It's a must-read doc for any network architect looking to get to grips with their NFV migration strategy. Join us for the interview, and the chance to ask Saar your NFV questions directly!
Hassan Ahmed, CEO of Affirmed Networks, is making some big claims for his NFV startup. I sat down with him at the Light Reading HQ in New York City to get the skinny on what this Acton, Mass.-based startup is up to.
With 200 customers in 60 countries, Stockholm-based Net Insight has carved out a solid leadership position in one of the hottest vertical markets going in comms right now: helping service providers and broadcasters deliver video and other multimedia traffic over IP networks. How has Net Insight managed to achieve this success in the face of immense competition from the industry giants?
Cats with Phones