Lucent Grabs Verizon Deal

Lucent

(LU)

surged 5% early Tuesday after the company snagged a $5 billion multiyear deal to upgrade the

Verizon Wireless

network.

The companies said the agreement calls for Lucent to supply a wide variety of network equipment, software and services for Verizon Wireless' national next-generation voice and data network. Verizon, the nation's leading wireless service provider, is a joint venture of New York telco

Verizon

(VZ) - Get Report

and British wireless giant

Vodafone

(VOD) - Get Report

.

The deal is an important win for Lucent, the struggling New Jersey telecom gear maker, because it was the incumbent supplier for Verizon Wireless. Even so, the contract could be seen as a setback for wireless equipment rivals such as

Nortel

(NT)

,

Nokia

(NOK) - Get Report

and

Ericsson

(ERICY)

.

Lucent will provide infrastructure and technology spanning its entire portfolio, including Bell Labs-developed wireless, optical and data networking equipment along with network management and applications software. Among the products to be supplied are Lucent's Flexent Modular Cell 4.0 base stations. Lucent Worldwide Services will perform network optimization, integration, planning and design, and deployment services.

TheStreet.com

reported last year that Lucent would snatch the closely watched contract. Even with Tuesday's win, however, the company continues to face a tight telecom spending market and numerous internal challenges.

On Tuesday, Lucent added 16 cents to $3.54.