Qualcomm Inc (QCOM)

[khemara_qc]

Ericsson, Lucent May Get Cingular Network Upgrade Deal

http://money.iwon.com/jsp/nw/nwdt_rt.jsp?cat=USMARKET&src=704&feed=dji§ion=news&...

Friday November 12, 2:42 PM EST


NEW YORK (Dow Jones)--Cingular Wireless, the largest U.S. mobile-phone company by subscribers, may soon announce plans to upgrade its network to support high- speed communications, giving equipment vendors Telefon AB L.M. Ericsson (ERICY) and Lucent Technologies Inc. (LU) the lion's share of the project.

Carriers like Verizon Wireless and Sprint Corp. (FON) are aggressively deploying high-speed networks, hoping to encourage consumers to spend more on wireless service by enticing them with features possible only on a fast network.

In light of Verizon Wireless and Sprint's efforts, Cingular has been noticeably slow to begin such an upgrade, working as it was toward completing the acquisition of rival AT&T Wireless Services. The combined Cingular is now the biggest U.S. carrier ahead of Verizon Wireless.



Ericsson and Lucent are likely to get 45% and 35%, respectively, of Cingular's $4 billion to $5 billion in upgrade spending over the next four years, said Inder Singh, a stock analyst with Prudential Financial, in research published Friday.

"We view this as a particularly important win for Lucent since the company has not played a major role in the GSM market," Singh wrote, referring to Global System for Mobile communications, the wireless technology Cingular uses on its network.

Lucent is a major supplier of infrastructure to Verizon Wireless, which uses CDMA, or Code Division Multiple Access, a competing wireless technology.

The high-speed technologies Cingular is likely to deploy are WCDMA, a variant of CDMA, and a higher-speed enhancement called HSDPA, or High-Speed Downlink Packet Access.

Siemens AG (SI) might get about 15% of Cingular's upgrade, Singh added, while Nortel Networks Corp. (NT), which continues to struggle through an accounting mess, "appears to have been excluded from this project."

On Thursday, Ericsson Chief Executive and President Carl-Henric Svanberg said at a conference in San Diego that Cingular needs to spend more to challenge Verizon Wireless.

Cingular is a joint venture of SBC Communications Inc. (SBC) and BellSouth Corp. (BLS). Verizon Communications Inc. (VZ) and Vodafone Group PLC (VOD) own Verizon Wireless.

-By Nick Baker, Dow Jones Newswires; 201-938-2020; [e-mail]