Telecom's AAPT in IP overhaul

Telecom New Zealand's AAPT is moving into the final stages of a A$30 million (NZ$34 million) network overhaul which ties its systems to those of last year's A$360 million acquisition Powertel.

AAPT network and technology general manager David Yuile says the installation of new routing hardware at the edge of the company's network marked the final phase of a three-part overhaul of AAPT's infrastructure.

The company had been working to move AAPT's networks closer to the data-oriented systems of PowerTel, which it acquired in May last year. "We have been working though combining the networks of the two companies," Yuile says.

Telecom's Australian subsidiary has long struggled against its local rivals, with the New Zealand carrier having previously unsuccessfully attempted to sell the business.

Yuile says the overhauled network would help AAPT renew the fight with its competitors. "We wanted to create something that competed with Optus and Telstra, because we did feel that, realistically, we had fallen a little bit behind," he says.

Long-time AAPT supplier, Franco-American group Alcatel-Lucent, will provide the hardware and some related services for the network edge update, in an agreement worth A$10 million.

The new technology will provide the basis for a number of new products, including a high-end VPN and new ethernet private line services, Mr Yuile says.

In April, Alcatel rival Cisco Systems was awarded A$20 million in contracts to renew core and distribution systems within the AAPT network. Yuile says the new systems, which made up the first two phases of the project, were now in production.

Some of the work on the network edge would be in place by Christmas, with the completed project in production by June, Yuile says.

AAPT had put its network strategy in place before the current meltdown in global markets, he says. "I'm glad we are further through it, because the exchange rate does make it harder to get the business case up."

For Alcatel-Lucent, business prospects in Australia remained "reasonably good", global president of the company's IP division Basil Alwan says. "We've got all the global concerns that everybody else does, but I think it's in reasonably good shape," he says.

Following its acquisition of struggling Lucent Technologies in 2006, Alcatel saw a huge slice of potential work go begging when Telstra later the same year announced that it would put on ice its fibre-to the-node project, announced as part of its huge A$11 billion technology transformation initiative in 2005.

Alcatel held a memorandum of understanding with Telstra for the fibre project, valued at the time at A$3.5 billion.

Citing a gag order put in place by the federal government, Alcatel Lucent IP division vice president for Australia and New Zealand Martin Claridge declined to comment on whether the fibre-to-the-node arrangement had morphed into an agreement for Alcatel's involvement in Telstra's bid for the government National Broadband Network project.

"It's fair to say that Alcatel-Lucent and Telstra still have a very strong relationship," he says. "We continue to be involved in multiple facets of their business." — MIS Australia