PARIS -- Alcatel (Paris: CGEP.PA and NYSE:ALA) today announced it has been selected by KPN, the incumbent operator in the Netherlands, to provide the network equipment to extend KPN's nationwide Ethernet Virtual Private Network (VPN) services for business customers and Ethernet aggregation for residential services. The contract is part of a substantial IP network transformation project that will give KPN one of the largest MPLS-enabled networks in the world, which in turn forms part of its All IP program, whereby most of the current (legacy) platforms and services will be migrated to Next Generation Network platforms and Next Generation based Services.

The contract was awarded by KPN following a highly competitive tendering process and is the second phase of an ambitious IP/Ethernet network transformation. Phase one was awarded to Alcatel in October 2005 for the delivery of triple play services from 28 main points of presence (POPs) and 172 medium PoPs located in 14 different regions. The second phase extension is expected to be completed by 2008 and will result in a network with an additional 1300 smaller POP locations − enabling KPN to deliver highly competitive Ethernet VPN services to businesses and consumers across the Netherlands from a single Ethernet/MPLS platform.

"KPN required a premium IP/Ethernet solution for a variety of standard services for business and consumers; services which require extremely high quality of service (QoS) characteristics," said Jan van Bekkum, Manager Marketing Broadband Services at KPN. "Alcatel was able to provide a solution that addressed the significant scaling requirements in addition to KPN's need to offer differentiated services to help maintain our competitive edge."

"This network extension by an innovative market leader creates an impressive nationwide MPLS- enabled network to deliver Ethernet services," said Basil Alwan, president of Alcatel's IP activities. "A transformation of this scale demonstrates the rapidly growing interest by businesses in deploying scalable, end-to-end Ethernet VPNs. KPN can now offer 'always on' point-to-point and point-to-multipoint services characterized by high availability features which are critical for meeting the requirements of today's enterprises."

Alcatel (NYSE: ALA; Paris: CGEP:PA)