Alcatel (Paris: CGEP.PA and NYSE: ALA) today announced that it has signed a contract with Telecom Egypt, the national fixed incumbent operator, to transform part of its network and offer Voice over IP (VoIP) services. Alcatel’s IP-based network transformation solution will enable Telecom Egypt to solidify and grow its subscriber base with new user-centric communications services as deregulation opens the Egyptian market to new entrants.

Eng. Dawlat El Badawi, Vice- Chairman Projects Planning at Telecom Egypt, said: “Alcatel’s end-to-end solution will open doors to new revenue-generating services, allowing us to provide our customers with the highest levels of excellence in all areas of service provisioning.”

“This contract is a big step forward in our relationship with Telecom Egypt and further positions Alcatel as the partner of choice for operators implementing IP network transformation projects,” said Michel Rahier, President of Alcatel’s fixed communications activities. “It is a perfect example of the added value that our technological innovation and deployment experience can bring to our customers.”

With this agreement, Alcatel will support Telecom Egypt in transforming part of its existing TDM network into an intelligent, service-oriented network based on innovative, next-generation technology.

Alcatel will provide key components of its IP multimedia subsystem (IMS) solution, including the Alcatel 5020 Softswitch as well as the Alcatel 7510 and 7515 Media Gateways to communicate between the existing TDM and new IP networks. In addition, Telecom Egypt will deploy the Alcatel 7750 Service Router and Alcatel 5620 Service Aware Manager in multiple sites.

Alcatel’s solution offers Telecom Egypt the quality of service required to assign priorities to traffic, which is critical to maintain maximum levels of satisfaction for VoIP and new services; the highest levels of reliability to assure non-stop service delivery; and, the massive scalability and superior performance management features needed to introduce the new IP-based multimedia services that make the network future-safe. It will also optimize the operation and maintenance of Telecom Egypt’s network, allowing for the smooth introduction of new services.

Telecom Egypt (TE) is expected to join hands with Telecom Italia to bid for a license to operate Egyp’s third-generation (3G) mobile network, state media reported on Thursday.

TE has reached an agreement with Telecom Italia to work together to tender for the third Egyptian mobile phone license, a TE official was quoted by the official MENA news agency as saying.

According to the agreement, a new firm would be set up, with majority stake owned by TE, if the two companies succeeded in winning the bid, said the official.

He said that TE is a major player in Egyptian telecommunications market while Telecom Italia has expertise and experience in 3G services in international market. The partnership was a natural outcome of previous agreements and cooperation between the two companies, the official added. Telecom Italia reached a deal with TE in 2004 that enabled the Egyptian company to offer Internet protocol services to its clients.

A total of 21 companies, which formed 10 major alliances, have applied to bid for the 3G license by the Thursday’s deadline, according to Amr Badawi, Chairman of the National Communications Organizing Authority, the watchdog of the Egyptian telecom market. The offer is expected to hit 50 billion Egyptian pounds (8.71 billion U.S. dollars), Badawi was quoted by Egyptian Gazette assaying.

The third telecom company is likely to be in operation six months after winning the bid, he added.

The Egyptian mobile phone service is currently dominated by two companies — MobiNil, a joint venture set up by Egypt’s Orascom Telecom Holding and France Telecom, and the U.K.-based Vodafone Group.