Alcatel wins a Euro 70 million 3G/UMTS contract with Telekom Malaysia

Paris, June 26, 2006 -- Alcatel (Paris:CGEP.PA and NYSE: ALA) today announced that it has been selected by Telekom Malaysia (TM) as the prime supplier of Celcom Berhad, a wholly-owned company of TM and Malaysia’s premier mobile communications provider, for its 3G/UMTS wireless network. This contract, valued at Euro 70 million, reinforces Alcatel’s position as CELCOM’s leading partner for advanced network solutions.

Upon completion of the project, Celcom will be able to offer customers across the Malaysian peninsula, as well as Sabah and Sarawak islands, a whole array of innovative high-bandwidth services for multimedia mobile communications such as live streaming mobile TV channels.

Under the agreement, Alcatel delivers 3G/UMTS radio access network infrastructure and high-performance digital microwave links to carry the traffic of enhanced mobile data services, enabling Celcom to complete the next phase of its national 3G deployment program.

Based on the Evolium® platform, Alcatel’s broadband wireless access solutions will offer Celcom high throughput on the move, low latency, end-to-end QoS, affordability, efficient backhauling and maximum site reuse. Thanks to its built-in software modularity, the Alcatel Evolium® radio access solution will allow a simplified software activation of HSDPA, through reuse the Alcatel hardware equipment already deployed in Celcom’s 3G/UMTS network.

“Celcom joins CamGSM (Cambodia) as the second Asia Pacific service provider, in less than three months, to select Alcatel for implementation of its 3G/UMTS network,” said Frédéric Rose, President of Alcatel Asia Pacific. “Celcom and CamGSM represent a growing number of Asia Pacific service providers in High Growth Economies that are evolving towards 3G and looking to Alcatel for an efficient software-upgradeable solution.”

Leveraging its natively multi-standard design, the Alcatel Evolium® multi-standard radio access solution enables the seamless coexistence of GSM/EDGE and 3G capabilities in the same radio equipment. Furthermore, thanks to its built-in software modularity, the solution will subsequently allow a smooth software-based introduction of HSDPA and HSUPA when the local market requires these functionalities, thus enabling a future-safe and cost-effective path for the operator.

The Alcatel 9400 AWY family is a new generation of digital PDH, low and medium capacity, point-to-point microwave links, which is part of one of the most comprehensive and competitive mobile network backhauling solution of the market. With multiple interfaces - PDH, SDH and Ethernet - the Alcatel solution enables a future-safe and cost-effective path for the operator.

Also selected are the Alcatel 7670 Edge Services Extender (ESE) and 5620 Network Manager (NM) which will provide high density aggregation and switching of 3G ATM circuits for the Evolium® radio access solution to also further reduce cost.

About Alcatel
Alcatel provides communications solutions to telecommunication carriers, Internet service providers and enterprises for delivery of voice, data and video applications to their customers or employees. Alcatel brings its leading position in fixed and mobile broadband networks, applications and services, to help its partners and customers build a user-centric broadband world. With sales of EURO 13.1 billion and 58,000 employees in 2005, Alcatel operates in more than 130 countries. For more information, visit Alcatel on the Internet: http://www.alcatel.com

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Mark Burnworth

Corporate Media Relations

Alcatel

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