Lucent wins $500 million CDMA deal with MetroPCS

Lucent Technologies extended its exclusive vendor deal with MetroPCS this week announcing a new three-year contract for CDMA 1X and EV-DO infrastructure worth up to $500 million.

The deal signaled MetroPCS’ intentions to migrate its networks to 3G and further expand its growing footprint in three new markets: Dallas, Detroit and Tampa, Fla. Lucent will supply all CDMA 1X radio access infrastructure for the new markets and expand MetroPCS’s already operational markets in Miami, San Francisco, Atlanta and Sacremento, Calif. While Lucent will supply the line card and software upgrades necessary to overlay EV-DO, neither company laid out a timeline for that migration.

While the new market deployments and the market expansions won’t equate the whole of the $500 million contract, a Lucent spokesman said that as part of the deal Lucent will build out any new markets MetroPCS launches in the next three years. Lucent will also deploy its Flexant Packet Switch in the network core, preparing the operator for the eventually launch of VoIP services, as well its standard Flexant CDMA2000 base stations. MetroPCS also said it would buy key products from Lucent’s application portfolio and rely on Lucent for maintenance and professional services work.

MetroPCS owns 23 licenses in major metropolitan regions across the U.S., including spectrum in some of the most desirable areas, such as San Francisco. In fact, MetroPCS sold 10 MHz of its valuable Bay Area spectrum to Verizon Wireless early this year for a cool $230 million, giving the mega-carrier the capacity it needed to rollout EV-DO services. In February MetroPCS also acquired 10 MHz of equally valuable PCS spectrum in Los Angeles from an FCC auction for $374.5 million. It has not announced plans for a Los Angeles launch though.

MetroPCS follows a maverick billing model similar to its fellow regional carrier Leap Wireless. Instead of bucket minute plans, MetroPCS offers flat-rate plans for unlimited local calling or unlimited local and long-distance calling. The Dallas-based operator now has 1.5 million subscribers.