The telecom equipment maker Alcatel-Lucent said on Wednesday that it has signed a research memorandum with China's biggest telecom carrier, China Mobile Communications Corp, in areas such as the next generation mobile networks and cloud computing.
The partnership will help the French-American telecom gear vendor to be in a better position to profit from the world's most populous mobile telecom market.
Ben Verwaayen, chief executive of Alcatel-Lucent, said the partnership will have a fundamental impact on the company as the focus of the world's telecom market is changing from networks to applications and services.
"The network is becoming more intelligent, not just access and transition but also applications," said Verwaayen in an interview on Wednesday.
That, according to the 56-year-old executive, requires closer ties between telecom carriers and telecom gear makers to provide better services to end-users.
According to the statement, the research areas will include the integration of China Mobile's Cloud-RAN and Alcatel-Lucent's LightRadio technology, advanced antenna technology and green networks.
Verwaayen declined to comment on Wednesday on the possible business contributions of the research partnership with China Mobile, merely noting that "we can make a real impact".
Results of the joint research will materialize in the market in the next 12 to 18 months, he said.
In November, Alcatel-Lucent signed a 1.18 billion euro ($1.68 billion) deal with China Telecom, China Mobile and China Unicom, as the country's booming economy creates increasing demand for communication equipment.
Last month, the company also announced that it was awarded contracts in China Mobile's construction of the fourth-generation (4G) TD-LTE trial network in Shanghai.
Verwaayen said he is optimistic about China's telecom industry in the years to come, as the market has always been growing faster than industry expectations.
He said the company plans to aggressively expand the operation of the Alcatel-Lucent Shanghai Bell, its flagship joint venture in China.
According to company figures, revenue of Alcatel-Lucent reached 4.86 billion euros, up 22.6 percent year-on-year.
Romano Valussi, president of Alcatel-Lucent's China business, said on Wednesday the company had achieved double-digit growth in China during the past three quarters.
The company said earlier that China contributed to about 10 percent of its overall revenue.