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AlcaLu Looking to Strike LTE Gold

Alcatel-Lucent (NYSE: ALU) says it has won a slew of new trial engagements for next-generation mobile broadband Long Term Evolution (LTE), as operators step up trial plans and the competition intensifies for commercial contracts.

AlcaLu's new president of 4G/LTE wireless networks, Ken Wirth, tells Unstrung that the vendor will launch 14 new LTE trials during the fourth quarter this year and first quarter next year. With those first-quarter plans factored in, AlcaLu has a total of 22 LTE trials scheduled for all of next year. (See AlcaLu Names 4G Prez and AlcaLu's Wirth Rides on 4G.)

AlcaLu has placed strategic importance on LTE as a technology that will play a role in turning the vendor's fortunes around. CEO Ben Verwaayen has singled out the proto-4G technology as a "flagship of change at Alcatel-Lucent," and hinted recently that the vendor is well placed to win more contracts. (See LTE: AlcaLu's Flagship and AlcaLu CEO Pitches Recovery Story.)

And with AlcaLu's flurry of new LTE trial activity, Wirth claims the vendor is starting to move in on other vendors' turfs.

"Those trial customers... are not just necessarily customers that have our Alcatel-Lucent 2G or 3G infrastructure in their network," says Wirth. "They involve a number of our competitors' embedded bases as well."

One of the new trials that AlcaLu has been selected for is with Telefónica SA (NYSE: TEF), which will also test equipment from Ericsson AB (Nasdaq: ERIC), Huawei Technologies Co. Ltd. , NEC Corp. (Tokyo: 6701), Nokia Networks , and ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763) in a trial project that will span six countries over a six-month period. (See Telefónica Kicks Off LTE Trials.)

Wirth would not be drawn on which of its wireless infrastructure peers pose the biggest threat in terms of competition for trial selections or commercial deals. "All my competitors I worry about," he says.

"The way that LTE is starting to accelerate in terms of interest in the marketplace, everybody is going after the same opportunity," Wirth adds.

With a commercial contract at Verizon Wireless for what will be one of the earliest deployments of LTE, Alcatel-Lucent is in a good starting position as the next-generation mobile broadband market begins to develop. But it is just a start. AlcaLu's performance in trials this year and next will in part determine how well it can turn trial work into commercial contracts. (See MWC 2009: Verizon Picks LTE Vendors.)

"[We're] really seeing customers move much more quickly than I think people thought maybe a year or so ago to really evaluate LTE and evaluate what it can bring to their business," he says.

According to the Global Mobile Suppliers Association (GSA) , there will be 14 LTE networks in service by the end of 2010 and 31 networks in service by the end of 2012. Overall, 39 operators are already committed to deploying LTE, according to GSA.

AlcaLu's not alone...
But how are AlcaLu's competitors doing when it comes to winning LTE trial engagements? Unstrung asked around, and here's what some of the competition has to say:

  • Ericsson isn't disclosing the exact number of LTE trials it has. But Thomas Norén, Ericsson's director of LTE, says, "We believe we have the largest number of trials. However, our focus is on commercial deployment and testing with device manufactures and operators."

    Ericsson is the other LTE radio access supplier to Verizon Wireless, along with Alcatel-Lucent, and it also has a commercial contract with Telia Company . (See Gartner to CIOs: Time to Freshen Up and TeliaSonera Makes LTE Connection.)

  • Huawei will have more than 25 LTE trials as of the end of this year, according to a company spokeswoman.

    The Chinese vendor already has commercial LTE contracts with TeliaSonera and Telenor Group (Nasdaq: TELN). Huawei's publicly announced trial engagements include T-Mobile Austria , Telefónica, and Vodafone Germany . (See Huawei Eyes UK LTE Trials, T-Mobile Reveals LTE Trial With Huawei, Vodafone Tests LTE With Huawei, V'fone Germany to Test LTE for Rural Broadband, Telenor to Test Huawei LTE, Huawei Bags Another Euro LTE Gig, and Huawei Blazing LTE Trail.)

  • Nokia Siemens says it has four LTE deal references: NTT DoCoMo Inc. (NYSE: DCM), Zain Group in Bahrain, Verizon Wireless for IP Multimedia Subsystem (IMS), with the fourth still not public.

    "We also have a number of trials ongoing," says a spokeswoman. "Our focus is on commercial hardware and software. In the industry service trials can only begin when commercial terminals are available in the [sic] 2010." (See DoCoMo Shells Out on LTE, Zain Bahrain Picks NSN for LTE, and NSN, Fujitsu Team for DoCoMo LTE.)

  • ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763) had not responded to Unstrung as this article was published, but it has trials with Hong Kong CSL Ltd. and Telefónica. (See ZTE Pumps Its LTE Credentials.)

  • Motorola Inc. (NYSE: MOT) and NEC have also scored an early contract win at Japan's KDDI Corp. (See KDDI Picks Challengers for LTE Deployment and KDDI Picks Moto, NEC for LTE.)

    — Michelle Donegan, European Editor, Unstrung

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