Alcatel (Paris: CGEP.PA and NYSE: ALA) today announced that Kazakhtelecom JSC, the leading fixed incumbent service provider in Kazakhstan, has selected Alcatel’s optical networking solution for triple play service delivery, including enhanced high-speed Internet access and evolution to IPTV (Internet protocol television), across the country. The new 6,000 km optical transport network will increase the capacity and extend the reach of Kazakhtelecom’s existing infrastructure, broadening its service offering to new areas.

The turnkey project is scheduled for completion in the first quarter of 2007. Based on Alcatel’s market-leading optical networking technologies, the new network will be the longest backbone network to be rolled-out in Central Asia, covering around 133 districts, 10 regional and 14 local departments.

The deployment of Alcatel’s end-to-end optical networking solution will dramatically boost Kazakhtelecom’s current network capacity to cost-effectively support existing and new services, including local to international voice services and broadcasting. This will enable Kazakhtelecom to optimize bandwidth according to the multiple traffic loads and to improve the quality of the xDSL service currently offered for high-speed Internet access.

“Kazakhtelecom is successfully carrying out strategic programs for the modernization of its telecommunication network, with a focus on guaranteeing high-quality and universal accessibility to services,” stated Azamat Syrgabayev, Vice-president, and Chief technical officer of Kazakhtelecom. “We firmly believe that Alcatel’s expertise in optical networking, along with its deep understanding of customer needs, can help us broaden our service offering and reinforce key benefits such as investment protection and cost-effectiveness.”

“Strengthening Alcatel’s long-lasting cooperation with Kazakhtelecom, this project marks a new important phase in the deployment of advanced optical transport technologies,” said Romano Valussi, President of Alcatel’s optical networking activities. “The functionality, flexibility and scalability offered by our solutions will help Kazakhtelecom address the accelerated broadband traffic growth, while preparing for new services yet to come, and drive greater operational efficiencies.”

The Alcatel optical/data convergent solution will be based on its 1626 Light Manager (LM) DWDM equipment, 1678 Metro Core Connect (MCC) and its Optical Multi-Service Node (OMSN) systems, all managed by the Alcatel 1350 management suite. Furthermore, Alcatel will be in charge of the installation, commissioning and integration of the equipment.

Alcatel (Paris: CGEP.PA and NYSE: ALA) and SFR announced today their collaboration in the field of mobile broadcasting in France. The objective of the joint effort is to validate business prospects for mobile TV broadcasting and evaluate the technical performance of Alcatel’s “Unlimited Mobile TV”, a hybrid satellite and terrestrial solution in the S-Band. This solution has received the support from the French Industrial Innovation Agency.

Alcatel and SFR are working together on different growth scenarios for the mobile TV market in France, as well as on a variety of marketing approaches to match different usage profiles and consumption models. Initial joint analyses of the potential revenues and cost of this innovative service in France tends to confirm interest in this new market. The usage patterns studied will be used to meet the needs of mobile TV users, whether in transit (with individual or public modes of transport), or nomadic (static) either outdoors or indoors (at home, at the office, or in public places such as shopping malls).

In addition, for the past few months the two companies have been conducting a technical evaluation of Alcatel’s proposed system. Alcatel and SFR have exchanged comparative deployment cost information for the different mobile broadcasting solutions. Alcatel provided SFR with information regarding configuration, as well as the number of sites needed to deploy such an S-band network, and the two companies have jointly validated certain technical and cost hypotheses associated with this deployment.

As stated by Jean-Dominique Pit, SFR Director of Strategy and Innovation, “SFR is convinced that mobile TV will be among the important services offered to its customers and wishes to provide them with an excellent technical solution combining a wealth of content with high quality coverage. This is why we are going to pursue joint efforts with Alcatel.” He added that “The 2006 FIFA World Cup showed a very strong attraction of worldwide customers for mobile TV services that are easily accessible, anywhere and any time. In France, SFR customers downloaded 1.4 million videos between June 9 and July 9, and subscribed to 140,000 goal alerts, 73% of those involving the French team. It is clear that future major international sporting events will help mobile TV come into widespread use, which will require effective broadcasting solutions, truly accessible everywhere and to everybody at the same time.”

Alcatel (Paris: CGEP.PA and NYSE: ALA) announced today that it has signed a non-binding Memorandum of Understanding with Nortel to acquire its UMTS radio access business (UTRAN) and related assets for USD 320 million. This is a key step in Alcatel’s strategy to further strengthen its UMTS market position, and thus expand its global leadership in broadband access.

With this deal, Alcatel should become one of the world’s largest suppliers of UMTS radio access solutions, and further reinforce its technology edge at a time when the UMTS market is expanding rapidly. The proposed acquisition would enhance Alcatel’s industry-leading mobile radio expertise and product portfolio with technology and products that enjoy strong recognition among leading operators such as the Vodafone and Orange groups. Alcatel also intends to benefit from significantly strengthened research and development capabilities, amongst the most advanced in the world, with the scale and know-how to lead innovation in broadband wireless access, especially in HSxPA and 3G Long-Term Evolution (3G LTE), fully leveraging Alcatel’s expertise in multi-standard radio solutions and Software Defined Radio (SDR) technology.

Under the transaction, Alcatel intends to acquire Nortel’s UMTS radio access technology and product portfolio, associated patents and tangible assets as well as customer contracts. It is anticipated that a significant majority of employees of Nortel’s UMTS access business, will be transferred to Alcatel.

Following the transaction, Alcatel would serve an additional fourteen UMTS customers around the world for a combined global footprint that amounts to one in four UMTS operators. Alcatel would also significantly reinforce its presence with Tier-1 operators, especially in world-leading 3G markets such as South Korea, Italy, Spain, France, and the UK. While strengthening its presence in developed mobile markets, the transaction would also put Alcatel in a unique position to serve the needs of major upcoming 3G markets, such as China and other key fast-growing regions, where the company already enjoys a strong GSM/EDGE footprint.

“The expertise of Nortel’s UMTS team is well-known. I am confident that the scale resulting from our combined forces (including those of Lucent, pending the conclusion of the merger) will pave the way for further success in the wireless market. We are clearly poised to become a strong number 3 in UMTS and HSxPA,” said Marc Rouanne, President of Alcatel’s mobile communications activities. “Combined with our strong GSM/EDGE position, our early leadership in WiMAX and our strong commitment to LTE, this acquisition will add further momentum to Alcatel’s broadband wireless access strategy. Through the contemplated merger with Lucent, the combined company will also enjoy a leading position in CDMA EV-DO, including a clear commitment to Rev C, thus offering the most comprehensive and innovative wireless access portfolio in the industry”, he added. “Together with our long-standing leadership in DSL, it makes us the partner of choice to assist our customers in their network transformation towards seamless broadband.”

“This deal will be a win-win for both companies and our customers,” said Richard Lowe, president, Mobility and Converged Core Networks, Nortel. “We will work closely with our UMTS access customers during the planned transition to make it as seamless as possible and will continue to provide the best support for other Nortel solutions deployed in their networks.”

The acquisition is subject to the execution of a definitive agreement and other closing conditions. The parties are targeting to complete the transaction in the fourth quarter of 2006.

Alcatel has and will continue to involve Lucent in the conclusion and implementation of this project in order to achieve the most efficient fit within the combined company.