Optical/IP Networks

Lucatel Tightens Grip on Telefónica

Telefónica SA (NYSE: TEF) today handed a significant next-generation network deal to Alcatel (NYSE: ALA; Paris: CGEP:PA) in a move that makes the French vendor and its bride to be, Lucent Technologies Inc. (NYSE: LU), critical partners with the Spanish incumbent. (See Alcatel Wins Deal.)

Alcatel is supplying Telefónica with its 7302 ISAM multiservice access node for bandwidth-hungry access services such as high-definition IPTV, its 7450 Ethernet Service Switch for aggregation and corporate services, and its Metrospan optical platforms.

An Alcatel spokesman says the deal is worth tens of millions of euros, and not the €4 billion (US$5.06 billion) reported by Spanish newspaper Cinco Dias, which also reported that Alcatel had beaten out Ericsson AB (Nasdaq: ERIC), Huawei Technologies Co. Ltd. , and Lucent Technologies Inc. (NYSE: LU) to win the deal.

The deal puts Alcatel and Lucent, which are planning to merge, in a very strong position at the Spanish giant. (See Alcatel, Lucent Near the Altar.)

Lucent is already well entrenched with Telefónica, especially with respect to the carrier's IPTV operations. (See Lucent, Telefonica Team on IPTV, Telefónica IPTV Hits 200,000, Telefónica Uses Lucent/Riverstone Combo, and Lucent Scores With Telefónica.)

In addition, Alcatel partner Acme Packet Inc. (Nasdaq: APKT) plays a key role in the carrier's VOIP network. (See Telefónica Deploys Acme Packet SBCs and Telefónica Uses Acme.)

Telefónica's other key vendor is Ericsson, especially now that it has Marconi on board. (See Ericsson Buys Bulk of Marconi, Ericsson Wins Telefonica Deal, Telefónica Deploys Marconi DWDM, Ericsson Provides IMS to Telefónica , and Telefónica Deploys BroadSoft.)

Ericsson is also one of Telefonica's main GSM and 3G radio access infrastructure suppliers, along with Siemens Communications Group , while Nortel Networks Ltd. won the right to provide the carrier's 3G core network.

— Ray Le Maistre, International News Editor, Light Reading

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