Alcatel Sets a New World Record for DWDM Backbone Networks at 5.12Tbit/s and Paves the Way Towards 10Tbit/s Transmission on a Single Fiber.

Business Editors/Technology Writers

PARIS--(BUSINESS WIRE)--Sept. 7, 2000

640,000 simultaneous high-bit rate ADSL Internet lines or over

100 million simultaneous voice calls on a single fiber

Alcatel (NYSE:ALA), the world leader in optical networking, today announced that it has set a new world record for DWDM (Dense Wavelength Division Multiplexing) transmission capacity over backbone networks. The company has achieved a unidirectional transmission of 128 channels each modulated at 40Gbit/s, reaching a total throughput of 5.12Tbit/s (5,120Gbit/s) over 300 km. This result was achieved with three technologies developed by Alcatel: 40Gbit/s DWDM systems, an innovating technique to make the most of existing bandwidth, and TeraLight(TM) optical fibers. This demonstration once again highlights the technological leadership of Alcatel in 40Gbit/s DWDM systems as well as the unequalled potential of the commercially available TeraLight(TM) fiber for 2.5, 10 and 40Gbit/s transmission.

This breakthrough transmission would allow for the transport of 640,000 simultaneous high-bit rate ADSL Internet lines or over 100 million simultaneous voice calls on a single optical fiber. It will allow operators and service providers to dramatically increase in the future the capacity transported over a single fiber, thus further optimizing the cost of their networks.

To achieve such a performance, Alcatel has developed a new technique to optimally use the bandwidth of optical amplifiers. When carried over an optical fiber, wavelengths generate interferences. It is therefore necessary to have a minimum spacing between each wavelength in the networks, which limits the number of wavelengths that can be transported over the same fiber. The higher the bit rate, the stronger the interferences and the more limited the number of wavelengths. The innovating technique developed by Alcatel allows to minimize the effect of these interferences and to pack an unprecedented number of DWDM 40Gbit/s channels on a single fiber, thus reaching the world record capacity of 5.12Tbit/s. This laboratory demonstration also exploited Alcatel's leading-edge NZ-DSF optical fiber, TeraLight(TM), which offers an optimized design for DWDM systems. This result, achieved in realistic conditions with in-line amplifiers, underlines the Alcatel strategy to optimize all the key technologies required to offer cost-effective, advanced optical networks to cope with the Internet explosion.

Christian Reinaudo, President of Alcatel's Optics Group, stated: "In the past years, the capacity of optical transmission systems has been doubling faster than the already impressive Moore's law predictions for electronics. Dense Wavelength Division Multiplexing (DWDM), in which Alcatel is the recognized world leader, accounts for most of this evolution. With this 5.12Tbit/s achievement, Alcatel paves the way towards 10Tbit/s transmission on a single optical fiber, thus offering its customers perspectives for unprecedented capacities and services at the lowest cost."

About Alcatel

In November 1999, RHK, a leading telecommunications analyst firm, said that Alcatel holds a 23% share - the number one position - of the world's total transport market, which comprises submarine and terrestrial transmission systems. RHK noted that Alcatel's market-leading 37% market share in the submarine networks segment helped secure the top position in the total transport market. In addition, RHK found that Alcatel commands a 37% share of the digital cross-connect systems (DCS) segment. Cross-connect systems contain the enabling technology for operators to offer high bandwidth services. Alcatel is also cited as the global leader in terms of DWDM market share for the global market encompassing both terrestrial and submarine applications.

Alcatel is the world leader in delivering full turnkey submarine network solutions and services. Alcatel leads this industry in terms of: - having the highest sold capacity up to 5.12 Tbit/s for the long-haul systems and 3.6 Tbit/s for the short-haul ones, using the latest DWDM technology; - having the largest manufacturing capacity at 85,000 km per year strategically located around the Globe; - managing 11 dedicated purposed-designed vessels for a tight control on the delivery schedule. Current contracts, worth US$ 4.5+ billion, include the most advanced undersea networks in the world today: Atlantica-1 and FLAG Atlantic-1 systems in the Atlantic, the FLAG Pacifc-1, Japan-US and Southern Cross transpacific systems, and the MAC and MAYA-1 systems in the Americas and the SAT-3 around Africa. 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