Report: Alcatel-Lucent close to small cell deal with French operator

Alcatel-Lucent is on the verge of winning a contract from a domestic French operator that would see the struggling manufacturer provide more of its small cell solutions for improved mobile coverage in France, Reuters has reported.

"There will be news soon," an unnamed source told Reuters, adding that the company involved was a rival of Orange. Orange competes with SFR, Bouygues Telecom and Iliad's Free Mobile in France's fixed and mobile market. Reuters noted that Alcatel-Lucent declined to comment on the report.

Other reports in the French press also said Alcatel-Lucent has just signed two deals with Orange that will bring 200 engineers from China to Lannion in France. The two deals, according to French online news site BFM Business, relate to small cells and big data analytics.

Small cells are a major focus for Alcatel-Lucent, which has been strongly promoting femtocells for better indoor coverage as well as metro cells to improve capacity and coverage for mobile operators. In July, the vendor signed a deal worth around €100 million ($137 million) in research spending with Qualcomm to develop small cells. As part of the deal, Qualcomm acquired a small stake in the network equipment manufacturer.

France's operators have already embraced small cell technology, and indeed, Iliad recently announced that it would give away 3G femtocells to subscribers of its Freebox Revolution broadband services. Silicon.fr said Alcatel-Lucent already provides small cells to Orange, SFR and Bouygues Telecom.

Right now, any new deals would be welcome for Alcatel-Lucent, which recently announced plans to cut a further 10,000 jobs globally, of which 900 are expected to be in France.

French unions and the government have been sharply critical of the job cuts, and indeed have even threatened to block the company's plans. The French Prime Minister Arnaud Montebourg has also called on the four French mobile operators to demonstrate their patriotism and use Alcatel-Lucent equipment, although Free Mobile has said a firm "non" to this instruction. According to French online site Generation NT, Iliad CEO Maxime Lombardini said Free is the only operator to not be a customer of a Chinese supplier. It had selected Nokia Solutions & Networks (NSN), and was not about to change that arrangement overnight.

Alcatel-Lucent CEO Michel Combes has warned that the vendor has little choice but to cut jobs and costs if it is to survive, saying this is its last chance to turn itself around.

For more:
- see this Reuters article
- see this Silicon.fr article (translated via Google Translate)
- see this BFM Business article (translated via Google Translate)
- see this Generation NT article (translated via Google Translate)

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Alcatel-Lucent to axe another 10,000 jobs in reorganization plan
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