Alcatel-Lucent Introduces Ultimate Wireless Packet Core to Help Service Providers Address the Explosion of Mobile Data Services on 3G and Emerging LTE Networks

Company delivers a variety of major innovations to drive the transformation to all-IP

PARIS, March 18, 2010 - Alcatel-Lucent (Euronext Paris and NYSE: ALU) today unveiled an unmatched
set of capabilities designed to help mobile service providers address the
explosion in mobile data services on today's 3G networks, and the anticipated
increase in data requirements with the emergence of Long Term Evolution (LTE)
mobile broadband. The company announced significant upgrades to its mobile
packet core solution along with a comprehensive and unique approach to IP
network and policy management that will bring the IP capabilities of 4G
networks to today's 3G subscribers.

With the advent of smart phones and bandwidth hungry applications such as
real-time video — which together are generating unprecedented growth in
mobile data traffic — service providers are faced with a variety of
simultaneous, and often conflicting challenges including: increasing network
capacity while reducing the cost per bit of supporting data services;
enabling new business models beyond today's 'all you can eat' offerings; and
transforming their networks to take advantage of the benefits of the shift to
all-IP networks, which offer simplified operational models and reduced
complexity.

"As mobile data traffic continues to grow, every part of the network is
being strained," said Peter Jarich, Service Director with Current Analysis
and author of the company's most recent mobile packet core analysis: "Mobile
Packet Core: Engine of Mobile Broadband Success." "While we applauded
Alcatel-Lucent's entry into the EPC space last year, we encouraged the
company to expand its solution into 2G/3G operations to better serve their
mobile broadband customers and best leverage their expertise in the RAN, IP
core and vendor services spaces. The new solution expansion does just that.
More importantly, positioning its gateways alongside policy and analytics
tools helps to deliver a fuller mobile packet core solution — and helps
operators with the service differentiation they're all chasing."

The new products and enhancements announced today deliver best-in-class
capabilities at every point in the network, including the 3G and LTE mobile
packet core. Service providers will now be able to deliver bandwidth-hungry,
enriched and personalized services with enhanced subscriber quality of
experience — all with reduced provisioning, operating and maintenance costs
across all parts of the network, from the radio access network (RAN) to the
backhaul elements and into the packet core.

These developments are an important contributor to the realization of
Alcatel-Lucent's High Leverage Network(TM) strategy — a fully converged,
scalable, next generation, all-IP multiservice infrastructure that enables
operators to deliver traffic more reliably, efficiently and at the lowest
cost, while also leveraging the network to generate revenue from
sophisticated managed services and applications.

To address the data capacity issues in wireless networks today and
tomorrow, Alcatel-Lucent's Ultimate Wireless Packet Core offering includes
the following new capabilities:

    -- 2G and 3G GGSN (Gateway GPRS Support Node) functionality on
       Alcatel-Lucent's 7750 Service Router-based mobile packet core
       gateways. Alcatel-Lucent's 4G mobile packet core gateway platform now
       supports GGSN for 2.5G and 3G as well as Serving Gateway and Packet
       Data Network Gateway for LTE, giving service providers a seamless and
       massively scalable solution for GPRS/EDGE, HSPA, HSPA+ and LTE. The
       7750 SR delivers more than ten times the performance and scale of
       typical 3G packet core gateways, has been in global LTE trials since
       2009 and will be available for commercial delivery of 2G, 3G and LTE
       services in the second half of 2010.
    -- The new Alcatel-Lucent Wireless Mobility Manager (WMM), a
       high-performance and scalable solution for 2.5G/3G SGSN (Serving GPRS
       Support Node) and LTE MME (Mobility Management Entity) on an in-house
       designed and optimized, common ATCAv2 platform. This combined
       functionality enables operators to expand or renovate their existing
       packet cores to support HSPA and HSPA+ today while having the
       signaling and control plane performance required of an MME when they
       migrate to LTE.

To address the need for smarter bandwidth, enabling mobile operators to
improve network efficiency and monetization, Alcatel-Lucent's end-to-end
wireless network and policy management offering now includes:

    -- The new Alcatel-Lucent 5780 Dynamic Services Controller (DSC), which
       provides the 3G and LTE PCRF (Policy Charging and Rules Function),
       enabling mobile operators to optimize and monetize network resources,
       while offering personalized choice for the subscriber in both a 3G and
       LTE environment. The Alcatel-Lucent 5780 DSC also provides the
       foundation for converged wireline/wireless policy management to enable
       any application on any screen, anywhere. The 5780 DSC is currently in
       global trials and will be available for commercial 3G and LTE service
       delivery in the second half of 2010.
    -- Enhancements to the Alcatel-Lucent 5620 Service Aware Manager (SAM) to
       include support for the Ultimate Wireless Packet Core and 5780 DSC,
       including unified, end-to-end management of user (data) and control
       planes across mobile backhaul and packet core. The 5620 SAM, deployed
       by more than 270 service providers to date, provides automated
       configuration and fault/performance management tools that decrease
       time to market for new mobile services and minimize downtime when
       problems occur.
    -- The Alcatel-Lucent 9900 Wireless Network Guardian (WNG) provides
       mobile operators with unprecedented and real-time visibility into the
       relationship between network element performance and end-user quality
       of experience (QoE) across the entire wireless data network. Selected
       most recently by a large North American wireless operator, the 9900
       WNG enables dynamic self-optimization and mobile customer care
       solutions for multi-technology/multi-vendor networks and is a critical
       element of Alcatel-Lucent's wireless offering.

"Our High Leverage Network(TM) strategy has enabled service providers to
deliver large-scale, real-time, residential triple play services (Internet,
Voice and IPTV) over the past five years and now we're bringing that strategy
to mobile operators as they deal with tremendous growth in data and video
applications. Our packet core platforms deliver unmatched scale and
performance to address the capacity crunch, our network intelligence and
policy management solution enables operators to deliver personalized services
with the appropriate subscriber quality of experience and we provide
end-to-end management across the 'all IP' wireless network to reduce time to
market and operational costs," said Basil Alwan, president of
Alcatel-Lucent's IP activities and head of carrier strategy. "We have best of
breed products across our wireless portfolio, but have also invested
significantly in integrating it all together in an end-to-end solution to
enable wireless operators to deliver innovative 3G and LTE services and
create competitive differentiation in the market."

For more information on Alcatel-Lucent's wireless IP solution and to read
the Current Analysis white paper, visit: www.alcatel-lucent.com/uwpc

Press Conference Details

Basil Alwan, head of Alcatel-Lucent's Carrier Group portfolio strategy,
will announce this news during a web press conference taking place March 18
at 8AM PDT/ 11AM EDT / 4 PM CET

To access the audio and web session please use the following information:

Audio bridge dial-in numbers:

N. America toll free: 866-383-8009

International toll: +1-617-597-5342

Participant passcode: 27826387

Webcast link:
phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c=94709&eventID=2790822

Participants will have the opportunity to ask questions at the end of the
presentation over the audio bridge or via the webcast interface tool.

About Alcatel-Lucent and LTE

Having been selected to support 40+ LTE trials around the globe and
securing commercial contracts with two of the largest operators in the world,
Alcatel-Lucent is a recognized market leader in LTE. To help operators
realize their potential, Alcatel-Lucent is offering a unique, pre-integrated,
end-to-end LTE network solution and a full set of associated professional
services. Alcatel-Lucent's end-to-end network architecture is pre-integrating
Alcatel-Lucent converged radio access network (2G/3G/4G RAN) and an
industry-leading IP networking solution encompassing Alcatel-Lucent's
Ultimate Wireless Packet Core, IP/MPLS mobile transport, wireless network
guardian, and a comprehensive IMS solution. This network solution allows
scaling of GSM/W-CDMA networks and a smooth evolution to LTE. The company
also founded the ng Connect Program, a global initiative to drive the
development of an open and diverse ecosystem of LTE device manufacturers,
content providers and application partners. Through the ng Connect program
and with Alcatel-Lucent's end-to-end LTE solution, wireless broadband
operators benefit from open innovation, pre-integrated solutions, reduce time
to market with LTE-enabled services, and the ability to drive new and
non-traditional business models.

For more information about Alcatel-Lucent's end-to-end LTE solution,
please visit: www.alcatel-lucent.com/lte

About Alcatel-Lucent's High Leverage Network

The Alcatel-Lucent high leverage network strategy allows network
providers to continuously scale the bandwidth of their networks from the
access layer to the transport layer at the lowest total cost of ownership to
provide scalable, reliable, low-cost bit transport. A high leverage network
also allows network providers to instrument or equip the network with
built-in service and application awareness, QoS, and traffic optimization to
provide the appropriate levels of intelligence within the network at the
optimum cost to deliver value-added services.

About Alcatel-Lucent

Alcatel-Lucent (Euronext Paris and NYSE: ALU) is the trusted
transformation partner of service providers, enterprises, strategic
industries such as defense, energy, healthcare, transportation, and
governments worldwide, providing solutions to deliver voice, data and video
communication services to end-users. A leader in fixed, mobile and converged
broadband networking, IP technologies, applications and services,
Alcatel-Lucent leverages the unrivalled technical and scientific expertise of
Bell Labs, one of the largest innovation powerhouses in the communications
industry. With operations in more than 130 countries and the most experienced
global services organization in the industry, Alcatel-Lucent is a local
partner with a global reach. Alcatel-Lucent achieved revenues of Euro 15.2
billion in 2009 and is incorporated in France, with executive offices located
in Paris. For more information, visit Alcatel-Lucent on the Internet:
www.alcatel-lucent.com

For Media: Peter Benedict, +33(0)1-40-76-50-84, Peter.benedict at alcatel-lucent.com, or Sarah Miller, +1-613-784-45-63, sarah.miller at alcatel-lucent.com; For Investors: Remi Thomas, +33(0)1-40-76-50-61, remi.thomas at alcatel-lucent.com, Don Sweeney, +1-908-582-6153, dsweeney at alcatel-lucent.com, Tom Bevilacqua, +1-908-582-7998, bevilacqua at alcatel-lucent.com; Tony Lucido, +1-908-582-5722, alucido at alcatel-lucent.com