Struggling Alcatel-Lucent to handle AT&T's 3G expansion

Quickly following up the announcement made earlier this month that AT&T would be expanding its 3G network by 80 cities to nearly 350 US Markets, Alcatel-Lucent announced today that it will be in charge of supplying it.

To facilitate AT&T's network growth, Alcatel-Lucent will provide its UMTS/HSDPA Distributed Node B solution, which allows less intrusive 3G radio deployments to be placed in more locations.

The publicity of this arrangement could improve the French company's position, which has lately been unfavorable. Its stocks dropped in value 33% in 2007, and the company posted a $3.74 billion dollar loss in the fourth quarter.

Such poor performance caused some to speculate that AT&T would actually drop Alcatel-Lucent, but the relationship between the two multinationals is long standing, and deeply rooted.

Long before Lucent was bought by Parisian company Alcatel in 2006, it was known as AT&T Technologies, and included Western Electric and Bell Laboratories (the research and development facility responsible for everything from the transistor to the C programming language.) It has supplied AT&T with, among other things, technologies for an IP Multimedia Subsystem (IMS), TDM, ATM, MPLS, as well as ADSL/VDSL broadband. This current supply agreement is actually built upon one that was established in 2004.

Earlier this week, Nigeria's second-largest telco Globacom announced it had launched the country's first 3G UMTS/HSPA network built upon Alcatel-Lucent's IMS-based infrastructure. Further, Angola's Unitel has selected the French company for similar deployments to begin this month.

With AT&T on a major upswing in 3G expansion, and growing international markets adopting the company's technology, Alcatel-Lucent should begin to see some pecuniary improvement soon.