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Alcatel to Create Israel Bell Labs to Boost Cloud Effort

May 20 (Bloomberg) -- Alcatel-Lucent plans to open a Bell Labs research center outside Tel Aviv to help the French network-equipment maker advance in cloud technology against competitors including Ericsson AB and Nokia Oyj.

“Israel was the very first country to really start to innovate in the field between telecommunications and Internet technology,” Chief Executive Officer Michel Combes said in an interview today. The facility “will contribute tremendously to Alcatel-Lucent playing a shaping role in the industry,” he said in a separate statement.

Combes, who took over last year, is focusing on innovation to turn around the company after years of losses following the 2006 merger of Alcatel SA and Lucent Technologies Inc. He plans to narrow research to focus on fast-growing technologies, including cloud-based architectures. The company may invest in Israeli cyber technologies in future, Combes said.

Israel is one of “three or four peak places” for his company’s investment, Combes said. “It is natural for Alcatel-Lucent to really establish itself in the country in order to be able to grab the best talents in the space in which we want to invest,” he said.

Faster Releases

Alcatel-Lucent, based in Boulogne-Billancourt, France, is promoting innovation to speed the release of new products. Ericsson, Nokia and Asian vendors such as Huawei Technologies Co. are also emphasizing cutting-edge technology, rather than relying on lower prices to win customers.

The Israeli Bell Labs center will be based in a building in Kfar Saba, outside Tel Aviv, that already houses an Alcatel-Lucent cloud-technology facility. Israel’s commercial hub is the world’s second-best startup area behind Silicon Valley, according San Francisco-based Compass Inc., which collects data on technology companies.

Alcatel-Lucent also runs the Nobel-prize-winning Bell Labs center in Murray Hill, New Jersey, as well as research sites worldwide including facilities in Villarceaux, France; Antwerp, Belgium and Shanghai.

“I hope that the next Nobel prize will be an Alcatel-Lucent Bell Labs guy from Israel,” Combes said.

To contact the reporters on this story: Gwen Ackerman in Jerusalem at gackerman@bloomberg.net; Marie Mawad in Paris at mmawad1@bloomberg.net

To contact the editors responsible for this story: Andrew J. Barden at barden@bloomberg.net; Kenneth Wong at kwong11@bloomberg.net Robert Valpuesta, Kim McLaughlin

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