Paris, August 26, 2009 - Alcatel-Lucent ( Euronext Paris and NYSE: ALU) today announced it has signed a centralized purchasing contract with China Telecom, China’s leading telecom operator, to provide and maintain an IP/MPLS backbone across ten provinces (Guangxi, Hubei, Jiangxi, Ningxia, Sichuan, Jiangsu, Guizhou, Gansu, Xinjiang and Shanghai). Upon completion in October 2009, China Telecom will be able to deliver advanced broadband services with superior quality to its millions of subscribers.The contract which is part of the USD700 million framework agreement recently signed between China Telecom and Alcatel-Lucent, was awarded to Alcatel-Lucent’s Chinese flagship company, Alcatel-Lucent Shanghai Bell.

“This agreement builds on our longstanding collaboration with China Telecom and our commitment to ensure our customer has a state-of-the-art network which supports its business goals and strategy,” said Olivia Qiu, President of Alcatel-Lucent in East Asia and Alcatel-Lucent Shanghai Bell. “This win also strengthens Alcatel-Lucent’s leading position in the Chinese IP market and is a further recognition of our ability to assist operators around the globe in their journey to all-IP networks.”

Alcatel-Lucent will deploy its 7750 Service Router (SR) and 7450 Ethernet Service Switch (ESS) 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.

Over 270 service providers in more than 100 countries around the world have selected the Alcatel-Lucent IP/MPLS portfolio as key elements of their IP transformation. According to Ovum RHK, Alcatel-Lucent holds the #2 position in the IP/MPLS Edge market segment worldwide, and the #1 position in EMEA.

About China Telecom
China Telecommunications Corporation (China Telecom) is an extra-large state-owned telecom operator organized according to China's telecom industry reform scheme. As a principal telecom enterprise and the greatest basic telecom operator of China, China Telecom owns the global largest fixed-line telephone network that covers the cities and towns as well as the rural areas of China and penetrates to every corner of the world. Member units of China Telecom include 31 provincial (municipal and autonomous regional) enterprises which provide telecom services nationwide.