Alcatel-Lucent Introduces the New Services Edge, With Terabit Performance on Industry-Leading IP and Carrier Ethernet Router Portfolio

PARIS, March 27 /PRNewswire/ --

- Breakthrough Silicon Innovations Enable More Speed, More Services and 
More Availability

To help operators around the world meet the demand for higher
bandwidth and scale, a richer service mix, reduced cost and increased
availability, Alcatel-Lucent (Euronext Paris and NYSE: ALU) has today
announced extensive enhancements to its industry-leading IP service routing
portfolio. Leveraging breakthrough silicon innovations from one of the
industry's most experienced R&D teams, the 7750 Service Router (SR) and 7450
Ethernet Service Switch (ESS) now deliver Terabit performance, providing the
bandwidth, scale and service awareness required to support the growing market
for more personalized, broadband offerings such as IPTV, WebTV, Virtual
Private Networks, and 3G/4G mobile.

The 7750 SR and 7450 ESS enhancements leverage
Alcatel-Lucent's unique new FP2 chipset (for network processing and traffic
management) - the result of a three-year development effort - which delivers
sophisticated and optimized network processing and traffic management at
speeds up to 100 Gb/s. The upgrades to the current products include more than
double the density of Gigabit and 10 Gigabit Ethernet ports as well as
supporting up to 10 times the number of services per router - reducing CAPEX
and OPEX as well as being more efficient from a power/bandwidth perspective.
The FP2 chipset also provides a clear path to 100 Gigabit Ethernet, vastly
improving Return on Investment (ROI) versus other edge routers which
currently use much lower performing and lower scale 10 Gb/s Network
Processors.

"Telstra's wireline transformation to implement a common IP
core network is delivering multiple services at lower costs and faster speeds
with improved network reliability. This enables us to provide our customers
with access to more scaleable and advanced broadband services, offering
99.999 per cent reliability," said Greg Winn, Telstra Chief Operations
Officer. "Alcatel-Lucent's technology is a part of our Telstra Next IP(TM)
network and the latest upgrades will enable Telstra to continue to innovate
and grow our broadband service offerings."

The Terabit enhancements to the Alcatel-Lucent IP/MPLS service
routing portfolio address three fundamental service provider requirements for
IP network transformation:

- More speed - delivering Terabit routing and Carrier Ethernet
capacity to support new opportunities for mass-market video-based services
and applications;

- More services - including secure IPSec (IP Security)
Virtual Private Networks (VPN) as well as Ethernet VPNs and IP VPNs, plus
application assurance, leveraging Deep Packet Inspection (DPI) technology to
help drive new service and revenue models;

- More availability - best-in-class node, link and network
high availability, leveraging existing support for non-stop routing, non-stop
services and In-Service Software Upgrades (ISSU)

Alcatel-Lucent has shipped more than 20,000 IP/MPLS systems
since 2004, resulting in an installed base of more than 200 service provider
customers in 90+ countries. The new portfolio enhancements address a Service
Provider Router and Metro Ethernet Switch market with a forecasted CAPEX of
more than USD 50 billion between 2006 and 2010 (source: Infonetics, August
2007).

"We've established a solid history of innovation and
reliability in IP/MPLS platforms, software and services, which has resulted
in new revenue opportunities for our customers," said Basil Alwan, President
of Alcatel-Lucent's IP business. "This is a transformative period in our
industry and, since 2003, we've led the way with a transformative
service-aware and application-aware approach to IP/MPLS routing. With these
seamless Terabit service routing upgrades, massive service scaling and
integration as well as best-in-class high availability, we're continuing to
deliver on this commitment to our customers."

The following enhancements to the Alcatel-Lucent IP/MPLS service router 
portfolio will be available in 3Q 2008:

Next Generation Silicon

    - Breakthrough 100 Gb/s FP2 chipset

    7750 Service Router Platform

    - Up to 1 Tb/s capacity
    - 50Gb/s (full-duplex) Input/Output Module3-XP (IOM3-XP)
    - 20-port Gigabit Ethernet MDA-XP (SFP-Fiber)
    - 20-Port 10/100/1000 Ethernet MDA-XP (Copper)
    - 2-port 10 Gigabit Ethernet MDA-XP (XFP)
    - 4-Port 10 Gigabit Ethernet MDA-XP (XFP)
    - Application Assurance Integrated Services Adaptor (AA-ISA) with DPI
      technology
    - IPSec Integrated Services Adaptor (IPSec-ISA)

    7450 Ethernet Service Switch Platform

    - Up to 1 Tb/s capacity
    - 50Gb/s (full-duplex) IOM3-XP
    - 20-port Gigabit Ethernet MDA-XP (SFP-Fiber)
    - 20-Port 10/100/1000 Ethernet MDA-XP (Copper)
    - 2-port 10 Gigabit Ethernet MDA-XP (XFP)
    - 4-Port 10 Gigabit Ethernet MDA-XP (XFP)
    - Application Assurance Integrated Services Adaptor (AA-ISA) with DPI
      technology



Alcatel-Lucent IP/MPLS solutions have been selected by more
than 200 service providers in more than 90 countries. During the fourth
quarter of 2007, Alcatel-Lucent reinforced its #2 position in IP/MPLS edge
garnering 18% of the market according to Ovum-RHK. For more information,
please visit: http://www.alcatel-lucent.com/ipnews

Press Conference details

Alcatel-Lucent will hold a web press conference for this
announcement on Thursday March 27 at 7am PST/10am EST/3pm CET (i) that will
be hosted by Basil Alwan, President of Alcatel-Lucent's IP business.

To access the session please use the following information:

Participant Passcode: IP Strategy

Audio bridge dial-in-numbers:

PARTICIPANT TOLL FREE (from the US): 800-779-1694

PARTICIPANT TOLL (International): +1-210-234-0000

WEBCAST URL: http://alcatel-lucent.acrobat.com/webcast/

The press conference will be available for digital replay on
the Alcatel-Lucent website at the following link:
http://alcatel-lucent.acrobat.com/webcastreplay/

(i) The US has moved to daylight savings time, while this has
not yet taken place for CET.

About Alcatel-Lucent

Alcatel-Lucent (Euronext Paris and NYSE: ALU) provides
solutions that enable service providers, enterprise and governments
worldwide, to deliver voice, data and video communication services to
end-users. As a leader in fixed, mobile and converged broadband networking,
IP technologies, applications and services, Alcatel-Lucent offers the
end-to-end solutions that enable compelling communications services for
people at home, at work and on the move. With operations in more than 130
countries, Alcatel-Lucent is a local partner with global reach. The company
has the most experienced global services team in the industry, and one of the
largest research, technology and innovation organizations in the
telecommunications industry. Alcatel-Lucent achieved revenues of Euro 17.8
billion in 2007 and is incorporated in France, with executive offices located
in Paris. For more information, visit Alcatel-Lucent on the Internet:
http://www.alcatel-lucent.com