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Lucent, Cisco Eye Simplified 3G

After months of development, Lucent and Cisco today introduced a new third-generation networking product for mobile carriers.

The offering -- combining Lucent's Softswitch with Cisco's MGX 8000 Series Media Gateways -- helps service providers deliver high-speed data, multimedia and voice over Internet protocol services. It will be sold as part of Lucent's newly announced VoIP portfolio.

The companies made the announcement at the 3GSM World Congress in Cannes, France. The milestone comes 13 months after the sector heavyweights signed a supply and reseller agreement for certain lines of packet data and media gateway equipment.

"Later in the year, that relationship was expanded with a development agreement," Cisco spokeswoman Kristina Scott told internetnews.com.

A spokesperson for Murray Hill, N.J.-based Lucent was not immediately available for comment.

Among the testers of the equipment is AT&T Wireless , which is using the packet switch/gateway product as part of a larger third generation service trial in Miami. Other carriers are testing the gear but were not named, the companies said.

AT&T Wireless, soon to be part of Cingular Wireless, is committed to rolling out 3G in four U.S. markets by year's end. It faces a $6 billion contractual penalty from investor NTT DoCoMo if it fails to do so.

In July, AT&T Wireless bought base stations and other gear for the project from Nortel and Ericsson , although details of the rollout remain hazy.

No customers have been named for the Lucent-Cisco joint product, but industry watchers expect those announcements to follow. Telecom analysts at SG Cowen view today's news as a "slight positive" because it shows progress in the partnership of the two companies. "This does provide some positive momentum for each company," the firm said in a research note today.

3G service, based on the Wideband Code-Division Multiple Access standard, features transfer speeds that support two-way video telephony and other bandwidth-consuming applications.

The technology has been slow to grow in the United States, but is popular in Japan where the 3G market will reach 69 million subscribers by 2007, according to IDC.

Mobile carriers envision using the technology to notch new revenue by offering consumers a way to download video clips, send and receive e-mail on the go. Businesses could use 3G to provide their employees in the field with access to their corporate networks and business applications they normally use in the office.