Alcatel Brings Carrier-Class to IP World with Alcatel 7420 Edge Services Router; New Product Means Higher Margins, More Satisfied Customers for ISPs.

Business Editors & High Tech Writers

SAN JOSE, Calif.--(BUSINESS WIRE)--Nov. 8, 2000

Building on its leadership position as a provider of carrier-class networking solutions, Alcatel (Paris:CGEP.PA)(NYSE:ALA) today introduced an edge services router that establishes new wirespeed performance levels for broadband, differentiated business Internet protocol (IP) services.

The Alcatel 7420 Edge Services Router (ESR) is the world's first carrier-class edge services router with the intelligence, scalability and reliability to deliver dedicated and differentiated business IP services at wirespeed.

"We have been testing the 7420 Edge Services Router since June and are very pleased," said Tim Lance, President of NYSERNet, a provider of next-generation Internet services designed to enable the goals of the education and research community in New York State. "So far we've exercised several of the most critical subsystems, including the PoS interfaces, the BGP router and the Command Line Interface. Successful interoperation with similar class routers of other vendors has been demonstrated. The level of support received from the Alcatel team has been exceptional. We look forward to working with them in testing additional features as they become available."

Designed for broadband speeds and high utilization, the Alcatel 7420 takes advantage of distributed network processors to implement the most complex, policy-based IP services while maintaining full wirespeed forwarding performance (for example, OC-12 and OC-48). This innovative architecture gives the Alcatel 7420 the scalability to increase capacity cost-effectively with high-density port counts. Both features are maintained on a "non-stop networking" platform that is designed to meet the rigid standards of service providers.

"The big opportunity in this market is in offering advanced, value-added IP services," said Michael Kennedy, Network Strategy Partners. "Based upon our extensive research with leading edge service providers, we think that the Alcatel 7420 Edge Services Router has achieved the unique balance of performance and intelligence that providers have been looking for to deliver these services."

Business customers are adopting IP for their mission-critical business support systems to save money and simplify the network services they buy. The ability to create differentiated business IP services enables service providers to differentiate themselves and increases customer retention and service margins.

"The introduction of the Alcatel 7770 Routing Core Platform and the 7420 Edge Services Router, both based upon network processor technology, will make Alcatel a credible vendor in the service provider IP router market," said David Passmore, Research Director, The Burton Group. "We think Alcatel is a player to watch and expect them to become much more visible in this space."

"We expect the North American ESR equipment market to be US$20B by the year 2003 with significant opportunities for new entrants that can demonstrate the technical superiority of their products," said Bob Larribeau, director, Edge Switching and Routing at RHK, Inc. "Service providers will favor edge routers built upon the scalability, reliability, performance and intelligence needed to overcome the limitations of today's IP networks."

The 7420 enables carriers to aggregate thousands of high speed, dedicated business IP lines in a low cost and smaller footprint, and its scalable architecture permits growth in a near-linear price model. In addition, the distributed network processor architecture enables feature enhancement and standards compliance updates via software downloads, thereby extending the life of the product without costly and intrusive physical swap outs.

"The 7420 expands Alcatel's proven leadership in reliable, carrier-grade solutions by now allowing ISPs to offer service guarantees for mission critical IP business services," said Barry Denroche, Vice President and General Manager, of Alcatel's Edge Data Networks. "Network operators can deploy the most sophisticated IP services without compromising packet forwarding performance. And they can do so at the same price they would pay for our competitors' products, but receive all the added benefits of the 7420."

The Alcatel 7420 Edge Services Router will begin in-service trials in Q1 2001 with volume shipping in Q2. Pricing for a fully configured and redundant system is $500 per T-1 (list price in US$).

Industry Supporters

"The Alcatel 7420, with its high availability features, sophisticated VPN support, and extensible network processor architecture, offers many of the key capabilities we seek," said Dr. Rick Bubenik, CTO of SAVVIS Communications. Alcatel's approach is very complementary to SAVVIS' Intelligent IP networking strategy, which brings the benefits of high-end private networks to small and medium-sized businesses, while also enabling the Fortune 1000 to be more nimble in the execution of their e-commerce strategies."

Dr. Rick Bubenik is executive vice president of network engineering at SAVVIS Communications, a leading national Internet and networking service provider. Throughout his career, Dr. Bubenik has been involved with the latest in ATM and switching/routing technologies, beginning with his research on switching fabrics at Washington University in the mid-1980s. In the early part of his career, he worked on developing one of the first commercial ATM products, and later received four patents on switching/routing technologies while employed at Ascom Nexion.

"CoreExpress has created a new Internet Core network that enables ISPs of all sizes to transfer data in a guaranteed quality of service manner from city to city and between customer site to customer site regardless of which ISP serves the initiating or terminating customers," said Mike Gaddis, president and CEO of CoreExpress "This service, targeted at business customers of the Internet, will create a demand for ISP edge routers that can converse in the language of IP QoS. ISPs, to compete in the future business-enabled Internet, will need devices like the 7420 to provide intelligent IP edge routing services."

About Alcatel IP

Alcatel has extensive design and development expertise in X.25, TDM, frame relay, ATM and SONET-based equipment. The recently launched Alcatel 7770 Routing Core Platform and Alcatel 7420 Edge Services Router, combined with the existing IP, DWDM and optical product range -- and all managed by a world-leading network and services management suite -- now equips Alcatel to offer advanced networking solutions to IP-centric service providers.

About Alcatel

Alcatel builds next generation networks, delivering integrated end-to-end voice and data networking solutions to established and new carriers, as well as enterprises and consumers worldwide. With 120,000 employees and sales of EURO 23 billion in 1999, Alcatel operates in more than 130 countries. For more information, visit Alcatel on the Internet: http://www.alcatel.com