Industry analysts are speculating that Canadian vendor Nortel may be planning to spin off its UMTS business following rumours of organisational changes within the company.

Nikos Theodosopoulos, analyst with investment bank UBS, said that he has received information which suggests that Nortel has organisationally separated the GSM and UMTS access businesses, “a move that may presage a potential spin-off/disposal of the UMTS access business”.

Nortel is one of the largest vendors which has remained noticeably uninvolved in the recent spate of equipment manufacturer mergers. The recently announced four year strategic alliance between Nortel and Microsoft as well as a focus on enterprise channel partnerships, indicate that the enterprise space continues to be an area of increasing focus.

Motorola is another manufacturer that has not participated in any of the mega-mergers that have seen Lucent and Alcatel and Nokia and Siemens come together in recent months. But the vendor yesterday formed a UMTS kit partnership with Chinese vendor Huawei, which could be an indicator of future strategy.

Nortel has also been wrong-footed this week by the departure of the vice president and general managers for WiMAX and Converged Core Networks including IMS. No replacements have yet been identified and the developments could put Nortel in a predicament as UBS points out that both IMS and WiMAX are two of three key strategic areas of focus for Nortel.

Alcatel (Paris: CGEP.PA and NYSE: ALA) and Delta Telecom, a leading cellular operator in Russia who operates under the Sky Link brand and provides CDMA-450 services in the city of St.Petersburg, Leningrad, Pskov and Novgorod regions, as well as in the Republic of Karelia, today announced the signature of a contract, to modernize the operator’s backbone network in the city of St. Petersburg and the region.

“We have partnered with Alcatel since 2001,” said Constantine Kolomensky, Director of Network Development for Sky Link St.Petersburg. “To keep leading position in the telecommunication market of the North-West region of Russia, we must continuously evolve our network. Benefiting from Alcatel’s expertise in optical networking, we will be well positioned to give our customers access to the most advanced highly reliable services, while reducing our total cost of network ownership.”

“Sky Link turned to Alcatel because of its ability to help transform their network in a timely manner and address subscriber demand for new, attractive services,” stated Romano Valussi, president of Alcatel’s optical networking solutions. “Setting the stage for a future migration to IP radio access networks, Alcatel’s optical networking solutions support the operator’s requirements for increased capacity driven by bandwidth-consuming mobile services”.

Sky Link represents a new breed of mobile operators that are turning to Alcatel to upgrade their infrastructure for the mobile data revolution. The Alcatel solution will be based on its data-aware Optical Multi-Service Node (OMSN) systems offering Delta Telecom a single platform optimized to aggregate multiple traffic types and backhaul the mobile traffic from base stations to the core. Furthermore, mobile switches will be interconnected though the Alcatel 1692 Metrospan Edge coarse wavelength division multiplexing (CWDM) system providing Gigabit Ethernet connectivity to cope with service growth. Alcatel will also upgrade the existing Alcatel 1350 management suite – which enables to manage packet, TDM and wavelength connectivity services.

Providing advanced multiplexing, aggregation and optical protection management, the Alcatel solution will enable Sky Link St. Petersburg to efficiently meet the growing needs for mobile voice and high-speed data services in the city of St. Petersburg and its area. The project is scheduled for completion in the third quarter of 2006.

Alcatel (Paris: CGEP.PA and NYSE: ALA) today announced that Jiangsu Telecom, a subsidiary of China Telecom, has selected Alcatel’s IP service routing solution to expand and optimize its metropolitan area network and broaden its IP-based data service portfolio. The Alcatel solution will enable Jiangsu Telecom to offer faster, highly reliable, and premium data services for consumers and enterprises across Jiangsu Province. The contract was won through Alcatel Shanghai Bell, Alcatel’s flagship Chinese company.

Jiangsu Telecom will deploy the Alcatel 7750 Service Router (SR) in the province’s four major cities, Nanjing, Wuxi, Yangzhou and Zhenjiang, where they anticipate fast-paced growth in demand from the consumer and business markets for advanced user-centric broadband services.

Upon completion of the project by the end of this year, Jiangsu Telecom will be able to deliver multiple services from a single IP network infrastructure, and with the Quality of Service (QoS) required to meet strict Service Level Agreements. Services include high speed Internet access for residential users as well as Layer 2 and 3 virtual private network (VPN) services for enterprises.

“This contract establishes Alcatel as the leading IP supplier to Jiangsu Telecom,” said Gerard Dega, President of Alcatel Shanghai Bell. “The Alcatel IP solution has the capability to ensure non-stop service delivery which is critical to meet today’s stringent market expectations. It also accelerates time to market through rapid service provisioning, ensuring service providers can move quickly to capture new market opportunities.”

Today, all major Chinese operators including China Telecom, China Unicom, China Netcom and China Mobile have selected the Alcatel 7750 Service Router to optimize the delivery of high-performance carrier data, voice and video services. China Telecom alone has selected the solution in 17 major provinces, including Xinjiang, Tibet, Qinghai, Gansu, Ningxia, Shaanxi, Guangdong, Shanghai, Jiangsu, Anhui, Hubei, Fujian, Jiangxi, Henan, Sichuan, Liaoning and Guizhou. According to Synergy Research Group, Alcatel is #2 in the Services Edge Router category in Q1 2006, with 18% market share, following four consecutive quarters of market share gain.