Alcatel-Telecom deal not signed

Telecom has chosen Alcatel as its preferred choice for 'strategic partner' in the development of its new all-IP network.

Telecom has chosen Alcatel as its preferred choice for "strategic partner" in the development of its new all-IP network.

Although the deal has yet to be signed - and is not due to be for some months - the development of an IP network that stretches across both Telecom and its Australian subsidiary AAPT makes the deal potentially one of the largest in Telecom's history.

"This isn't an outsourcing arrangement - I wouldn't classify it as that," says Alcatel communications manager Robyn Bern.

"But it is a significant deal and once it's signed we will certainly be making a song and dance about it."

Telecom has signalled its intention to commit to more of these strategic partnerships - it has already signed on with EDS to provide for its IT needs and Ericsson for its existing cellular network. This deal, however, could well dwarf even the EDS agreement which was at the time the largest of its kind in New Zealand. Signed in July 1999, Telecom outsourced its entire IT structure to EDS and Microsoft for $1.5 billion over 10 years. EDS and Microsoft, it should be noted, are Telecom's partners in its virtual company, esolutions. The deal was so large that Telecom took a 10% stake in EDS New Zealand as part of the agreement.

The deal is expected to be finalised in the new year.

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