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Alcatel-Lucent advances China Mobile and China Unicom’s move to the cloud

Alcatel-Lucent has signed wide-ranging frame agreements worth more than €1.1 billion with two of the largest telecoms companies in the world, China Mobile and China Unicom.

Under the agreements – designed to facilitate the operators’ transition to dynamic cloud-based networks – Alcatel-Lucent will deliver its mobile and fixed ultra-broadband access, IP routing, and agile optical networking products, as well as network functions virtualisation (NFV) capabilities and Nuage Networks’ software defined networking (SDN) technologies.

Michel Combes, CEO of Alcatel-Lucent, said: “This announcement is highly significant as it furthers Alcatel-Lucent’s role as a key technology provider in China and aligns perfectly with our strategy of bringing high-speed ultra-broadband access to open up new opportunities for both service providers and their customers alike.”

Both contracts span one year and are valued at approximately $716 million and $568 million (€656 million and €520 million) for China Mobile and China Unicom, respectively.

The deployment of these technologies will support the two Chinese companies in meeting their commitments to the ’Broadband China’ initiative which aims to see full broadband coverage across the nation’s rural and urban areas by 2020.

China’s Ministry of Industry and Information Technology has set the target for all the country’s municipalities, city districts and most non-urban households to have access to 100Mb/s by 2017. Within the same timeframe, China also expects residents of major cities to have an average access rate of 30Mb/s, 80 per cent of administrative villages to have fibre connections, with full 4G mobile access in urban and rural areas.

The strategy was designed to be carries out in three phases. Fibre-optic networks and 3G mobile coverage was rolled out in 2013, with broadband coverage expanded in 2014 and 2015. The final stage of the project set out for the period 2016-2020 was network and technology updates.

These deals represent an important milestone for Alcatel-Lucent as it will play the role of key technology provider in China Mobile and China Unicom’s execution of the Broadband China initiative. Alcatel-Lucent has had a major presence in China for more than 30 years through its Alcatel-Lucent Shanghai Bell venture, and has well-established working relationships with the Chinese operators.

Last year, Alcatel-Lucent and China Mobile announced a one-year comprehensive frame agreement valued at up to €750 million for its transformation to an all-IP network. Back in 2011, China Unicom selected Alcatel-Lucent as the supplier for its fixed access network roll-out based on GPON technology.

Alcatel-Lucent also highlighted the fact that, in October 2014, the vendor announced that it would be delivering its 7950 XRS IP core router to China Unicom and other Chinese service providers.

Li Huidi, vice president of China Mobile said: “We have been working closely with Alcatel-Lucent on the development of technologies to help the smooth transition to cloud networks. We are pleased to continue this collaboration and under this agreement we can benefit from Alcatel-Lucent’s leading solutions to help us expand connectivity across the company and enable new efficiencies across our network.”

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