February 14, 2006

Nothing says “I’m sticking with you” like a three-year contract for network services and equipment.

Cingular Wireless L.L.C. said it will stand by its long-time equipment supplier, the much beleaguered Nortel Networks Ltd., as the nation’s largest carrier gets serious about upgrading its network to third-generation technology.

Cingular said Nortel’s GSM and UMTS technology will support the carrier’s network expansion and subscriber growth, as well as allow it to reduce costs, increase network reliability and improve the quality of its service.

Nortel estimates that its equipment will help provide an increase in capacity of up to 300 percent.

Under the new agreement, Nortel is to deploy its is 2G/3G 3GPP Release 4-compliant Mobile Switching Center Server and Media Gateway products to support Cingular’s UMTS/HSDPA network deployment, the companies said.

Nortel noted that it has already deployed more than two million ports of its MSC solution to support Cingular’s GSM network.

Nortel has been a Cingular supplier since 1995.

“This contract represents a new footprint for Nortel and is a testament to our leadership in voice over packet technology and 3G wireless broadband solutions,” said Mike Zafirovski, president and chief executive officer of Nortel.

“We’re applying our networking expertise from wireless and wireline packet voice technology to help make operators like Cingular more successful.”

Though terms of the contract were not disclosed, the contract should go a long way toward boosting confidence at Nortel, which has been buried under various accounting scandals.

News of the contract didn’t stimulate Nortel’s stock this morning however; the company’s stock remained relatively unchanged at $2.97 per share.

Source: Boston.com

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