Nortel wins Spanish 3G contract worth $935 million
By Emily Bourne, Total Telecom
25 October 2000
Nortel Networks has won a contract worth US$935 million to install a UMTS network in Spain for the Xfera coalition. The
deal is the Canadian vendor's third 3G contract win.
Xfera, a new entrant in the Spanish mobile market, aims to offer commercial service in August 2001. Nortel said it will
provide the IP core and 50% of the radio access plus services; it is also providing vendor financing. Swedish vendor
Ericsson will provide the remainder of the radio access network, in a deal worth $250 million.
Xfera said it will initially deploy the network in Madrid, Southern Spain, the Canary Islands and much of the north eastern
portion of the country.
Xfera, a coalition led by Vivendi and including Finland's Sonera as well as local financial and construction companies, was
awarded a 3G license in March, the only newcomer alongside the three incumbents.
Before the license award the group said it would invest up to 1.3 trillion pesetas (US$6.54 billion). Spanish construction
group ACS, which holds 20% of Xfera, said recently it has earmarked 91.1 billion pesetas ($458 million) for 3G purposes;
and in May, Vivendi said it planned to invest 5 billion euros ($4.2 billion) over the next 10 years to develop its Spanish
license.
Nortel said its three 3G contracts to date total over US$1.8 billion. It was selected by BT Cellnet in the U.K. in May, and in
September was chosen by Spanish operator Airtel, in a deal worth $100 million over one year. The vendor said then it was
aiming for the number one slot in the provision of 3G systems, and was hoping to win multiple contracts in some countries.
Nortel said its UMTS solution includes: its e-mobility Internet Base Stations for wide area radio coverage; packet based
core networks with Passport multiservice switches; its Preside network and services management; Shasta services
management; and transmission equipment. The UMTS portfolio, under the banner "Wings of Light," was unveiled at the
UMTS 2000 Congress earlier this month. The company recently announced 2000 jobs in its wireless Internet business in
Europe, and wireless development centers in France, Germany, Italy, Spain and the U.K., as well as a research and
development center for wireless Internet in Barcelona, Spain.
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