Alcatel-Lucent and NEC announce a Long Term Evolution (LTE) Joint Venture as the first step in a broader collaboration

Mobile World Congress – Barcelona. - Alcatel-Lucent (Euronext Paris and NYSE: ALU) and NEC (TSE:6701) today announced the start of a broad collaboration to market advanced end-to-end communications solutions.

As an important first step in this collaboration, Alcatel-Lucent and NEC have decided to form a joint venture that will focus on the development of Long Term Evolution (LTE) wireless broadband access solutions. These solutions will support the network evolution of leading customers around the world, such as NTT DoCoMo, who has already selected NEC as a vendor for commercial service deployment of its Super 3G (LTE) project, and Verizon, with whom Alcatel-Lucent has already initiated a LTE trial program. Through this joint development effort, the two companies intend to accelerate the availability of next-generation wireless solutions.

Leveraging the common LTE product strategy and platform of the joint venture, Alcatel-Lucent and NEC will each manage delivery, project execution and dedicated support to their respective customers.

Under this joint venture, the two companies will pool their existing research & development resources and leverage market-proven expertise in key technologies on which next-generation wireless access is based, such as IP, multiple input/multiple output (MIMO) and orthogonal frequency division multiple access (OFDMA). Through this joint development effort, Alcatel-Lucent and NEC are affirming their R&D investment commitments and combining them to accelerate product innovation, differentiation and performance. The goal of the two companies is to achieve faster commercial availability of LTE solutions, serve an expanded, global customer base, and establish a leading position in the early development phase of the LTE market. The two companies will make first commercial releases available in 2009, and will leverage their field-proven wireless expertise to ensure smooth integration of LTE technology with the existing W-CDMA/HSPA and CDMA/EV-DO networks of their respective customers.

“By leveraging complementary portfolios, robust research and innovation capabilities, and strong market positions in Japan and around the globe, the partnership is well positioned to hasten the evolution towards the next-generation of mobile services,” said Philip Marshall, who heads up technology research at Yankee Group. “This is a smart pairing that will help accelerate the availability of LTE by capitalizing on early market implementations that we expect to occur in Japan and North America.”

“This strategic collaboration with NEC is driven by scale, time-to-market, and product excellence objectives, and it will put us in a strong position to ride the next wave of transformation in the wireless industry,” said Patricia Russo, CEO of Alcatel-Lucent. “By drawing upon our combined innovation capabilities, we will be able to effectively accompany leading operators as they migrate their network to next-generation wireless broadband technology, hence sustaining the value of their networks well into the future,” she added.

“This collaboration gives us the potential to open up new market opportunities for advanced wireless services globally,” said Kaoru Yano, President of NEC Corporation. “Moreover, NEC’s core competence lies in integrated IT/network solutions business. Through this alliance, we intend to explore the potential for collaboration with Alcatel-Lucent to best leverage both companies’ market-leading capabilities in a wide range of fields. We expect this partnership to contribute to the execution of our next-generation network business strategy by expanding our reach into global markets.”

In the future, the collaboration is expected to expand into end-to-end third-generation (3G) CDMA-based solutions, as well as a wide range of advanced IP-based solutions, such as optical transmission, IP service routing, and IMS-based communications services. Alcatel-Lucent and NEC will also investigate collaborating in developing IT solutions for service providers - such as service application solutions (e.g. streaming, e-commerce, etc.)- together with the servers and storage products on which those solutions depend.