Alcatel and ICE Sign $149 Million Contract to Roll Out First GSM/GPRS Network in Costa Rica.

Business Editors/Telecommunication Writers

DALLAS--(BUSINESS WIRE)--March 25, 2002

Contract enables service provider to offer enhanced mobile data services

Alcatel (NYSE: ALA) signed a $149 million contract with ICE (Instituto Costarricense de Electricidad), the incumbent telecommunications service provider in Costa Rica, to provide a full turnkey GSM 1800/GPRS mobile services nationwide network.

The Alcatel GSM 1800/GPRS network will support up to 400,000 lines and will overlay a previous D-AMPS network. It will offer enhanced mobile data services such as broadband Internet and M-commerce, as well as wireless data transactions at speeds reaching 115 kilobits per second (Kbps) - about twice the speed of the fastest dial-up modems. Thanks to Alcatel's complete GPRS end-to-end solution, ICE will ensure a natural migration path to 3G.

Alcatel will supply its industry leading Evolium solution which is composed of a radio base station subsystem, a core network sub system, including a mobile switching center, and a home location register. Alcatel will also supply an Intelligent Network platform for value-added services and revenue-generating applications such as prepaid, voice mail service and a short message service center.

To carry high-capacity traffic between the base stations, the network will use Alcatel's microwave radio systems with an efficient and powerful network management platform. Along with providing the infrastructure equipment, Alcatel will ensure the entire management of the project, including network planning and implementation, site acquisition and construction and network operation and maintenance.

"This contract with Alcatel represents one of the most significant milestones ever for the ICE group's history," said Pablo Cob, president of ICE. "It will allow us to benefit from a large variety of services and will pave the way to mobile telephony of the future. GSM, one of the most widely spread technologies in the world, will help us change our lifestyles."

"The contract confirms the success and the reliability of our Evolium solution, which is being adopted by an increasing number of operators in Latin America," said Marc Rouanne, president of Alcatel's Mobile Networks group. "With this 2.5G network, ICE will be able to offer its customers a range of advanced GPRS communications as well as state-of-the-art GSM services and products."

Today, one out of four service providers have contracted Alcatel for the supply of its GSM 900, 1800 and 1900 networks in all five continents. Alcatel has been involved in Latin America since the arrival of GSM technology and has already installed two of the first GSM networks commercially open on the continent, in Paraguay and in El Salvador.

About Alcatel

Alcatel designs, develops and builds innovative and competitive communications networks, enabling carriers, service providers and enterprises to deliver any type of content, such as voice, data and multimedia, to any type of consumer, anywhere in the world. Relying on its leading and comprehensive products and solutions portfolio, stretching from end-to-end optical infrastructures, fixed and mobile networks to broadband access, Alcatel's customers can focus on optimizing their service offerings and revenue streams. With sales of Euro 25 billion in 2001 and 99,000 employees, Alcatel operates in more than 130 countries. For more information, http://www.alcatel.com

About ICE

ICE, fully owned by the government, is Costa Rica's sole telecommunications operator. Since 1963, ICE was commanded to provide telecommunications services throughout the country. ICE's success is recognized internationally as Costa Rica's telecommunications indicators rank among the best in Latin America.