The cancellation of Telstra's proposed fibre
to the node broadband network has hit Alcatel's bottom line, with
several billion dollars being cut out of a deal between the two
announced last November.
In November, Telstra announced an AU$3.5 billion memorandum of
understanding with Alcatel as part of the telco's next-generation
network transformation project.
However a large chunk of that deal was Telstra's now defunct
fibre to the node broadband network.
"Telstra and Alcatel today announced a works program for
Telstra's fixed network transformation in 2006-07, which has an
expected value of AU$460 million," said a joint statement issued
by the two today.
"The works program is part of Alcatel and Telstra's strategic
supplier relationship announced in November 2005."
Telstra and Alcatel had always stipulated the finalisation of the deal depended on getting what the telco described as "reasonable regulatory outcomes" from the federal government, particularly on the fibre to the node network. The memorandum of understanding additionally needed to be finalised into contractual arrangements.
Alcatel's involvement in the next-generation network project
is now limited to helping establish an "Internet Protocol network
footprint" in Melbourne, Sydney, Brisbane, Perth and
The vendor will supply and deploy hardware including DSL
Access Multiplexers (DSLAMs) and Ethernet aggregation and optical
Telstra's executive managing director of Network &
Technology, Dan Burns, said some of the work had already
"Since announcing its transformation strategy in November
2005, Telstra had made solid progress in its move to a
next-generation fixed network -- Telstra connected its first
customer to Alcatel's IP-DSLAM technology earlier this year," he
said in the statement.
"These upgrades are important for future-proofing our network
over the next five to 10 years, to provide customers with access
to offerings such as high-speed Internet, telecommuting, video
conferencing and video delivery of services in general."