Under the terms of the contract, Alcatel will EDGE-enable the Evolium? 900 and 1800 MHz base stations already installed in the operator's network using the multi-standard GSM/EDGE/WCDMA capability of its industry leading Evolium? solution. The EDGE technology, embedded in the Alcatel Evolium? radio access solution and already installed in the SMARTS network, will be deployed thanks to a simple software activation. Alcatel will also add new base stations to the operator's network, guaranteeing full coverage of the whole territory where the SMARTS group of companies provide mobile services, and providing an optimal quality of services.

This project will enable SMARTS to deliver, to its customers in Samara and the Povolzhie region, new broadband mobile applications and services such as video streaming, MMS, high-speed access to the Internet and electronic messaging service.

The Alcatel solution will be delivered in several phases, with the first phase scheduled for completion by the third quarter of 2004 and the last phase by end of first quarter 2005. The commercial service will be operational by the fourth quarter 2004.

Gennady Kirushin, general director of SMARTS, commented: "We have partnered with Alcatel for several years already developing GSM infrastructure in Povolzhie region. This contract indicates a new step in our cooperation. The decision we made in favor of Alcatel's Evolium ? EDGE-ready solution was the right one allowing us to offer our customers the latest broadband services with minimum investments."

Marc Rouanne, chief operating officer of Alcatel's mobile activities, added: "This is our second project in Russia for the deployment of a commercial EDGE network. It demonstrates the growing demand for new broadband user-centric services in the fast-developing Russian market. We are glad to partner with SMARTS on the deployment of a leading EDGE network in Russia."

About SMARTS

SMARTS (Middle Volga interregional association of radio-telecommunication systems), one of Russia's leading mobile operators, was founded in 1991 and offers GSM900/1800 mobile communication services to its more than 1,5 million subscribers. Currently SMARTS's network covers 16 regions of Russia, including Astrakhanskaya, Volgogradskaya, Ivanovskaya, Orenburgskaya, Penzenskaya, Samarskaya, Saratovskaya, Ulyanovskaya and Yaroslavskaya regions; Bashkortostan, Kalmykia, Maryi-El, Mordovia, Tatarstan and Chuvashia Republics and Krasnodarsky region's territory. http://www.smarts.ru

About Alcatel

Alcatel provides communications solutions to telecommunication carriers, Internet service providers and enterprises for delivery of voice, data and video applications to their customers or to their employees. Alcatel leverages its leading position in fixed and mobile broadband networks, applications and services to bring value to its customers in the framework of a broadband world. With sales of EURO 12.5 billion in 2003, Alcatel operates in more than 130 countries.

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