Newbridge signed a five-year, $350 million agreement with Toshiba to distribute wireless-telecommunications equipment in Japan. BellSouth's Movicom will use $50 million of Newbridge equipment to build a high-speed wireless voice and data network. France Telecom, Europe's second-largest phone company, will build a wired network to combine voice, data, and video traffic.
Newbridge has been counting on rising sales of devices that speed network traffic using asynchronous transfer mode, or ATM, technology, to boost profit. It's been increasingly trying to parlay its expertise in ATM technology, which France Telecom is using, to sell new wireless gear that lets telecommunications companies offer a variety of Internet, voice, and video services.
"The France Telecom deal is an important step for Newbridge," said Mike Urlocker, an analyst at Scotia Capital Markets who rates Newbridge "hold."
"It's a national network, and Newbridge hasn't had too many contracts like that in the past couple of years."
Financial terms of that agreement weren't disclosed. France Telecom didn't immediately respond to a question about the contract's value.
France Telecom is buying "many hundreds" of Newbridge's flagship MainStreetXpress 36170 switch, which is used by more than 350 telecommunications-service providers, the companies said. Urlocker estimated each switch costs $500,000 to $1 million.
Canada's National Post reported earlier that Newbridge won contracts valued at about $500 million, including the France Telecom agreement.
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