Verizon Taps Nortel for Major VoIP Conversion

Verizon Communications says this year will dramatically accelerate the evolution of its nationwide wireline network to packet-switching technology and has selected Nortel Networks as its voice over IP equipment provider.

Verizon's initial service deployment as a result is scheduled for mid-2004 and is expected to include hosted VoIP and multimedia services for business and consumers.

The RBOC expects to begin deployment of the new Nortel Networks equipment in its local and long-distance voice wireline networks later this year through a five-year agreement Verizon expects to have in place within the next few months, following the letter of agreement that has already been signed by the two companies.

Through the deal, Verizon plans to deploy Nortel Networks Succession carrier VoIP solutions and Multimedia Communications Portfolio as the backbone of its national network migration. In addition, Verizon will continue to market and sell Nortel Networks enterprise IP Telephony portfolio to business customers nationwide.

Key elements of Verizon's arrangement with Nortel Networks are:
- Begin the replacement of a number of Verizon's traditional local switches with Nortel Networks softswitches and VoIP gateways, in what the companies say is expected to represent the largest conversion of its kind in the nation. In addition, Verizon will begin using the Nortel Networks switches to expand the company's long-distance network.
- Nortel Networks will be the exclusive provider of Verizon's local and long distance Class 4/tandem and Class 5/local VoIP switches in new offices over the next 18 months.
- Nortel Networks will be the exclusive supplier of Verizon's VoIP and multimedia services infrastructure over the next 18 months.
- Verizon and Nortel Networks will engage in collaborative selling initiatives aimed at upgrading Verizon's enterprise PBX customers to VoIP and interconnecting these PBXs via Verizon's converged network. Together, Nortel Networks and Verizon will target the 13,000 Nortel Networks Meridian PBX systems and 150,000 Norstar key systems used by Verizon's enterprise customers in Verizon's territory.

Nortel Networks has already started shipping equipment for Verizon's long distance, tandem, and end-office networks, including Succession Communication Server 2000 Superclass softswitches and the Multimedia Communication Server 5200, as well as VoIP gateways.

"Construction of this next-generation wireline network will drive new revenue growth for us as we expand the services we can offer to customers nationwide, as well as make our existing network more efficient while maintaining our high level of network reliability," says Lawrence T. Babbio Jr., Verizon vice chairman and telecom president. "This move is as significant as when the industry began moving from analog to digital technology in the 1980s."

The telco says it plans to offer “one of the industry's most comprehensive suite of VoIP and multimedia services, including instant video calling, unified messaging, Web-based call screening and routing and address book integration, providing its consumer and business customers in the United States with simplified communications that dramatically increase functionality, mobility and productivity.”

For business customers nationwide, Verizon plans to offer bundled local and long distance voice, data and new productivity enhancing multimedia services and applications. Enterprise customers will be able to augment traditional dial-tone services with more flexible IP services such as instant video calling, unified messaging, web-based call screening and routing and address book integration. Nortel Networks VoIP solutions and Multimedia Communications Portfolio, which include VoIP VPNs, Centrex IP and converged multimedia services, will enable Verizon to offer enterprise customers the ability to simply connect multiple sites as well as link telecommuters and mobile workers nationwide via a single high-speed packet network. This initiative builds upon Verizon's Enterprise Advance, a nationwide network buildout announced in December 2002 and now operational in 56 markets. Verizon will leverage Enterprise Advance to offer voice, data and multimedia services both within and outside its traditional serving territory.

For residential customers, Verizon will be able to offer a complete suite of bundled services, including local and long distance VoIP service, as well as Internet access all over a single broadband connection. Residential and enterprise customer traffic will share Verizon's common packet network.

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