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Optical/IP

Lucent Lands BellSouth Deal

Lucent Technologies Inc. (NYSE: LU) has cemented its position as one of the industry's leading suppliers of IP Multimedia Subsystem (IMS) technology with news of a wide-ranging deal with BellSouth Corp. (NYSE: BLS).

The RBOC will use a range of Lucent technology and support services to develop and deliver VOIP services to its residential DSL customers. Financial terms of the "multiyear agreement" were not disclosed.

In a prepared statement, BellSouth CTO Bill Smith stated: "We selected Lucent as our IMS supplier because of the depth and breadth of what the company brings to the table -- IMS leadership, significant expertise as a multivendor network integrator, and an IMS-based solution that can enable scalable services that can be deployed fast and efficiently with the quality and reliability that customers expect from BellSouth."

Lucent has enjoyed a number of high-profile IMS announcements of late, most particularly with SBC Communications Inc. (NYSE: SBC) and Cingular Wireless LLC, and was seen as a frontrunner for the BellSouth deal, beating out rival Sonus Networks Inc. (Nasdaq: SONS). (See BellSouth: The IMS SuperBowl? , Cingular Picks Lucent for IMS, and SBC Jumps on Lucent IMS Bandwagon.)

"In general, we consider today's announcement, coupled with Lucent's recent announcements with SBC and Cingular, evidence of Lucent's momentum in the industry and strength as a leading telecom equipment provider," states Lehman Brothers analyst Jiong Shao in a research note issued this morning.

Lucent is now regarded as favorite to pick up a similar deal at Verizon Communications Inc. (NYSE: VZ). (See Lucent in the Lead for Verizon IMS?)

These deals won't be adding to Lucent's top or bottom lines just yet, though. In its recent quarterly earnings call, senior Lucent management admitted that even during fiscal 2006 (which ends September 2006) IMS deals won't be contributing "material revenues." CEO Pat Russo said, though, that Lucent's strategy was to secure IMS relationships now to be "in the hearts and brains of customer networks." (See Pension Concerns Hit Lucent.)

Lucent's share price is currently down 5 cents, about 2 percent, at $2.75.

IMS is a standards-based architecture designed to enable telecom operators to provide a broad range of SIP-based services across packet or switched networks to any customers, fixed or wireless. It's regarded as the best approach to fixed/mobile convergence, and is touted as a way for carriers to launch new services more quickly and efficiently. (See IMS Guide.)

BellSouth will deploy Lucent's Network Controller media gateway controller, or softswitch, and the vendor's media gateway (dubbed the Network Gateway). Lucent Worldwide Services will provide integration services, "including network and security design, installation and engineering, and program management," stated the vendor.

— Ray Le Maistre, International News Editor, Light Reading


For a comprehensive look at how IMS is driving network convergence, check out IMS: Blueprint for an Applications Revolution, to be held at the Langham Hotel in London on December 8, 2005.

Hosted by Graham Finnie, Heavy Reading Senior Analyst, IMS: Blueprint for an Applications Revolution will ensure that attendees understand both the opportunities and threats the IMS revolution presents.

For more information, click here.

Sponsorship opportunities are still available. Direct all inquiries to: [email protected].




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