Telefónica picks Alcatel-Lucent, Ericsson for Spanish LTE deployment

Telefónica has selected Alcatel-Lucent and Ericsson as its network vendors for LTE service in Spain and said it is rolling out an integrated LTE and fibre optic network across the country, with LTE services set to be launched in some cities in the coming days.

The operator said it invested almost €1.7 billion ($2.65 billion) in its Ultra Broadband (UBB) network in 2012 and over €627 million in the first half of 2013, and is using 1800 MHz spectrum for LTE services until 800 MHz spectrum becomes available. The company recently signed a deal with Yoigo to use the operator's LTE network, while Yoigo will use Telefonica's fixed services for a multi-service offering. Telefónica expects to roll out around 2,200 nodes in 2013 and will reach 3,000 by the first quarter of 2014. The operator then aims to cover about 60 major cities across Spain.

Telefónica's Movistar will thus become the last of the four Spanish mobile operators to launch LTE services, after Yoigo launched its services in July, and Orange Spain and Vodafone Spain and launched their services in June and May, respectively. Telefónica said commercial services will be available to customers in Madrid, Barcelona, Malaga and Valencia in the coming days, with Seville and Alicante to follow in October and other cities by the end of the year.

Alcatel-Lucent confirmed it had won a contract from Telefónica to provide an LTE overlay network. Although Alcatel-Lucent did not comment on the value of the deal, which it described as its largest LTE agreement in Western Europe to date, a company spokesman said this "a significant win" for the vendor. "We're supplying 8,000 base stations, which is around 60 per cent of the total Telefónica are deploying," the spokesman added.

Ericsson said it will build the network in Madrid and Barcelona, rolling out about 1,000 nodes in 2013.

The deal is a particular coup for Alcatel-Lucent, which now has two publically announced agreements for LTE in Europe as a whole. It also has trials in place, as well as an LTE-based R&D joint venture with Rosstechnologi in Russia, the spokesman added.

Globally, Alcatel-Lucent said it has more than 40 contracts for commercial deployments, including two of the largest LTE network rollouts to date, with two more in process and more than 40 trials worldwide. LTE overlay represents an important strategy in Europe for the loss-making vendor, which is in the midst of implementing a turnaround strategy to revive its fortunes. During the presentation of the company's "Shift Plan" in June, CEO Michel Combes said he believed overlay is a better solution than Single RAN for LTE deployments in Europe, and thinks the region will change its focus to overlay networks in future.

According to ABI Research, Alcatel-Lucent was the only other vendor to report sequential growth in RAN revenue in the second quarter of this year, with a 3.4 per cent increase. The research company said the vendor currently ranks fourth in the global RAN market with a 14.3 per cent share, behind Huawei, Ericsson and Nokia Solutions and Networks (NSN).

For more:
- see this Alcatel-Lucent release
- see this Ericsson release
- see this Telefónica release (translated via Google Translate)

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