Qualcomm buys stake in Alcatel as pair work on 'ultra broadband' wireless hardware

American and French companies unite to speed up development of high-speed hotspots

Struggling telecoms hardware manufacturer Alcatel-Lucent has announced a research partnership with American wireless giant Qualcomm. The pair plan to produce small-cell wireless access for areas such as shopping malls and university campuses.

Qualcomm is said to have bought around a five percent stake in the French firm, thought to be worth around €100m according to the Financial Times. The two companies will work on small-cell 4G wireless networks, which Alcatel already supplies to companies such as Telefónica in Spain.

Small-cell technology brings high-speed wireless internet access to built-up areas, and is often used to boost 4G speeds in city centres.

Qualcomm's CEO Paul Jacobs said that the partnership would speed up the development process for the next generation of wireless. "Working together with industry leaders like Alcatel-Lucent, we can accelerate the dense deployment of small cells globally, driving another significant leap in advanced wireless broadband technology and services," he said.

Alcatel-Lucent has lost €10bn since a 2006 merger, but today posted small profits of €46m against analyst expectations, who had predicted the company would make further losses. CEO Michel Combes, who has been in office for four months, said that the new deal marks the beginning of the company's new strategy.

"This initiative perfectly illustrates The Shift Plan we announced last month, which will see Alcatel-Lucent focus on growth technologies, including those facilitating ultra broadband access. We also said we would actively seek collaboration with key industry players."

He added: "In working together with Qualcomm Technologies - a world leader in advanced wireless platform solutions such as its small-cell chipsets - Alcatel-Lucent will continue to be positioned at the forefront of innovation in the small cells market."

Alcatel has also been making inroads into the budget smartphone market, with the new open-source Firefox OS launching on an Alcatel device earlier this year.