Alcatel and Datang Group to advance TD-SCDMA development

Reinforced cooperation between the two companies within China and overseas

Beijing & Paris, November 24, 2006 – Alcatel (Paris: CGEP.PA and NYSE: ALA) and Datang Telecom Technology and Industry Group (Datang Group) today signed a Memorandum of Understanding (MOU) in Beijing that further reinforces Alcatel’s commitment to support China’s home-grown 3G standard, TD-SCDMA. This MOU complements an initial agreement that was concluded between Datang Mobile and Alcatel Shanghai Bell in November 2004.

According to the MOU, Alcatel and Datang Group will work closely together to drive TD-SCDMA development. Specifically, the MOU reinforces the cooperation that currently exists between the two companies in the areas of sales, marketing, industrialization, research and development of TD-SCDMA products and technologies for the domestic China market. Alcatel will assist the Datang Group abroad and support this global effort by taking advantage of its worldwide presence in over 130 countries. Finally, the MOU includes joint development of LTE (Long Term Evolution) products and technologies.

The signature of this MOU is a demonstration of the confidence both companies place in the future of TD-SCDMA and of their intention to become leading providers of TD-SCDMA when 3G arrives in China and well-positioned to capture a number of market opportunities.
In November 2004, Alcatel and Datang Mobile, a subsidiary of Datang Group, signed an agreement to invest in the industrialization of TD-SCDMA in China. In April 2005, Alcatel Shanghai Bell and Datang jointly demonstrated a live end-to-end TD-SCDMA solution during the TD-SCDMA International Summit in Beijing. In August 2005, the two companies finished the TD-SCDMA industrialization and announced readiness for large-scale commercial deployment. In March 2006, Alcatel Shanghai Bell and Datang jointly established a TD-SCDMA lab to provide a real network environment dedicated to interoperability testing between GSM and TD-SCDMA applications.

About TD-SCDMA
TD-SCDMA is one of three 3G standards licensed by International Telecommunication Union (ITU) put forth by Datang Group on behalf of China in the year of 2000. The other two are W-CDMA and CDMA 2000.

About Datang Group
Datang Telecom Technology and Industry Group (Datang Group) was founded in 1999 with the approval of the Ministry of Information Industry (MII) of China, and is directly under the administration of the State-Owned Assets Supervision and Administration Commission (SASAC) of the State Council. It is a large high-tech enterprise group specializing in development, manufacturing and sales of electronic information system equipment, such as, wireless and mobile communications, smart IC card and SOC (System On Chip) chip, data communication, high-capacity digital switching, software and system integration. Datang Group has two listed companies, 5 sole corporations, joint ventures and holding companies as well as 8 research institutes under its administration, which lie in Beijing, Chongqing, Xi’an, Shanghai, Chengdu and other cities, with nearly 10 thousand employees in total.

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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Régine Coqueran

Corporate Media Relations

Alcatel

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