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Cisco gets into Lucent's business

Lucent plans to use Cisco-made equipment to fill out the lineup of cell-phone networking equipment it sells to wireless carriers.

Lucent Technologies and Cisco Systems are doing business together for the first time, the companies said Tuesday.

Lucent will be using Cisco-made equipment to fill out the lineup of cell-phone networking equipment it sells to wireless carriers. First, it will resell Cisco gateways that link wireless phone networks with the wired Web, the companies said. In addition, Cisco will supply Lucent with equipment that increases the calling capacity of current generations of cell phone networks using GSM (Global System for Mobile Communications) technology, the world's most popular cell phone standard.

Most major U.S. carriers have finished building a second generation of cell phone networks, capable of hosting more calls at once and offering wireless data services. Some, like Sprint PCS, are already testing a third generation of equipment.

Carriers have tailored the initial set of services from these new networks to businesses, which are usually the earliest adopters of new technologies. Market researcher IDC believes that business customers using only wireless data plans will generate $16 billion in revenue for wireless carriers by 2006.

"For carriers, business customers are their closest market, although we fully expect these services to eventually reach consumers," said Mary Ward, a Lucent representative.

Terms of the deal between Lucent and Cisco were not released.