##### Table of Contents

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

[x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF

THE SECURITIES EXCHANGE ACT OF 1934

FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2005

OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13
OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM _________________________ TO
_________________________

COMMISSION FILE NO.: 001-11639

LUCENT TECHNOLOGIES INC.

(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

|                                                                   |  |                                     
|------------------------------------------------------------------ |  | ------------------------------------
|DELAWARE                                                           |  | 22-3408857                          
|(STATE OR OTHER JURISDICTION OF
    INCORPORATION OR ORGANIZATION) |  | (I.R.S. EMPLOYER IDENTIFICATION NO.)
|600 MOUNTAIN AVENUE, MURRAY
    HILL, NEW JERSEY                   |  | 07974                               
|(ADDRESS OF PRINCIPAL EXECUTIVE
    OFFICES)                       |  | (ZIP CODE)                          

REGISTRANTS TELEPHONE NUMBER, INCLUDING AREA CODE:
908-582-8500


SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE
ACT:




SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE
ACT:




















DOCUMENTS INCORPORATED BY REFERENCE








---



##### 

SCHEDULE A

Securities registered pursuant to Section 12(b) of the
Securities Exchange Act of 1934:

|                                            |  |                       |                         | 
|------------------------------------------- |  | --------------------- | ----------------------- | 
|                                            |  | Name of Each Exchange |                        
|Title of Each Class                         |  |                      
|                                            |  | on Which Registered   |                        
|Common Stock (par value
    $.01 per share) |  |                       | New York Stock Exchange | 
|7.25% Notes due July 15,
    2006           |  |                       | New York Stock Exchange | 
|5.50% Notes due
    November 15, 2008       |  |                       | New York Stock Exchange | 
|6.50% Debentures due
    January 15, 2028   |  |                       | New York Stock Exchange | 
|6.45% Debentures due
    March 15, 2029     |  |                       | New York Stock Exchange | 




TABLE OF CONTENTS


|                                                                                                           |  |                                                                                                                      |  |      |    | 
|---------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------- |  | ---- | -- | 
|Item                                                                                                       |  | Description                                                                                                          |  | Page |   
|                                                                                                           |  |                                                                                                                      |  |      |   
|PART I                                                                                                    
|Item 1.                                                                                                    |  | Business                                                                                                             |  |      | 3  | 
|Item 2.                                                                                                    |  | Properties                                                                                                           |  |      | 21 | 
|Item 3.                                                                                                    |  | Legal
    Proceedings                                                                                                |  |      | 21 | 
|Item 4.                                                                                                    |  | Submission of
    Matters to a Vote of Security Holders                                                              |  |      | 23 | 
|PART II                                                                                                   
|Item 5.                                                                                                    |  | Market for
    Registrants Common Equity, Related Stockholder Matters and
    Issuer Purchases of Equity Securities |  |      | 24 | 
|Item 6.                                                                                                    |  | Selected
    Financial Data                                                                                          |  |      | 24 | 
|Item 7.                                                                                                    |  | Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations                        |  |      | 24 | 
|Item 7A.                                                                                                   |  | Quantitative
    and Qualitative Disclosures About Market Risk                                                       |  |      | 24 | 
|Item 8.                                                                                                    |  | Financial
    Statements and Supplementary Data                                                                      |  |      | 25 | 
|Item 9.                                                                                                    |  | Changes in and
    Disagreements with Accountants on Accounting and Financial
    Disclosure                         |  |      | 25 | 
|Item 9A.                                                                                                   |  | Controls and
    Procedures                                                                                          |  |      | 25 | 
|Item 9B.                                                                                                   |  | Other
    Information                                                                                                |  |      | 25 | 
|PART III                                                                                                  
|Item 10.                                                                                                   |  | Directors and
    Executive Officers of the Registrant                                                               |  |      | 26 | 
|Item 11.                                                                                                   |  | Executive
    Compensation                                                                                           |  |      | 26 | 
|Item 12.                                                                                                   |  | Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters               |  |      | 26 | 
|Item 13.                                                                                                   |  | Certain
    Relationships and Related Transactions                                                                   |  |      | 27 | 
|Item 14.                                                                                                   |  | Principal
    Accounting Fees and Services                                                                           |  |      | 27 | 
|PART IV                                                                                                   
|Item 15.                                                                                                   |  | Exhibits and
    Financial Statement Schedules                                                                       |  |      | 28 | 
|EX-10.II.B.3: ELECTRONICS MANUFACTURING SERVICES AGREEMENT                                                
|EX-10.II.B.4: EXTERNAL MANUFACTURING SERVICES AGREEMENT                                                   
|EX-10.II.B.5: TRANSITION AGREEMENT                                                                        
|EX-10.III.A.4: FORM OF 2003 LONG TERM INCENTIVE PROGRAM STOCK OPTION AGREEMENT                            
|EX-10.III.A.5: FORM OF 2003 LONG TERM INCENTIVE PROGRAM NONSTATUTORY STOCK OPTION AGREEMENT               
|EX-10.III.A.6.A: FORM OF 2003 LONG TERM INCENTIVE PROGRAM RESTRICTED STOCK UNIT AWARD AGREEMENT           
|EX-10.III.A.6.B: FORM OF 2003 LONG TERM INCENTIVE PROGRAM RESTRICTED STOCK UNIT AWARD AGREEMENT           
|EX-10.III.A.6.C: FORM OF 2004 LONG TERM INCENTIVE PROGRAM RESTRICTED STOCK UNIT AWARD AGREEMENT           
|EX-10.III.A.7: FORM OF 2003 LONG TERM INCENTIVE PROGRAM PERFORMANCE AWARD AGREEMENT                       
|EX-10.III.A.8: FORM OF 2003 LONG TERM INCENTIVE PROGRAM PERFORMANCE AWARD AGREEMENT FOR EXECUTIVE OFFICERS
|EX-10.III.A.14: SUMMARY OF COMPENSATION OF NAMED EXECUTIVE OFFICERS                                       
|EX-10.III.A.15: SUMMARY OF COMPENSATION TERMS FOR NON-EMPLOYEE DIRECTORS                                  
|EX-10.III.A.17: OFFICER SEVERANCE POLICY                                                                  
|EX-10.III.A.18: OFFICER SEVERANCE POLICY                                                                  
|EX-10.III.A.21: OFFICER SEVERANCE PROGRAM                                                                 
|EX-12: COMPUTATION OF RATIO OF EARNINGS                                                                   
|EX-13: SELECTED PORTIONS OF ANNUAL REPORT TO SHAREOWNERS                                                  
|EX-21: SUBSIDIARIES                                                                                       
|EX-23: CONSENT OF PRICEWATERHOUSECOOPERS LLP                                                              
|EX-24: POWERS OF ATTORNEY                                                                                 
|EX-31.1: CERTIFICATION                                                                                    
|EX-31.2: CERTIFICATION                                                                                    
|EX-32: CERTIFICATION                                                                                      








2



---



##### Table of Contents

PART I







Item 1.
    BusinessCompany Overview

Lucent Technologies Inc. (referred to in this report as the
Company, we, us,
our or Lucent) designs and delivers the
systems, services and software that drive next-generation
communications networks. Supported by Bell Labs research and
development, we use our strengths in mobility, optical, access,
data and voice networking technologies, as well as services, to
create new revenue-generating opportunities for our customers,
while enabling them to quickly deploy and better manage their
networks. Our customer base includes communications service
providers, governments and enterprises worldwide.

Corporate Information

We were incorporated in Delaware in November 1995. Our
principal executive offices are located at 600 Mountain Avenue,
Murray Hill, New Jersey 07974 (telephone number 908-582-8500).
Our fiscal year begins October 1 and ends
September 30. Through a link on the Investor Relations
section of our Website, www.lucent.com, we make
available, free of charge, our annual report on Form 10-K,
quarterly reports on Form 10-Q, current reports on
Form 8-K, and amendments to those reports as soon as
reasonably practicable after such material is electronically
filed with or furnished to the SEC. These reports and other
information are also available, free of charge, at
www.sec.gov. Alternatively, the public may read and copy
any materials we file with the SEC at the SECs Public
Reference Room at 100 F Street, N.E., Washington, D.C.
20549. Information on the operation of the Public Reference Room
may be obtained by calling the SEC at 1-800-SEC-0330.

Company History

Lucent Technologies was initially the systems and technology
units that had been part of AT&T Corp., including the
research and development icon Bell Laboratories. Although we
separated from AT&T on September 30, 1996, our history
dates back to 1869 when the Western Electric Manufacturing
Company was formed. By 1880, it was the largest electrical
manufacturing company in the United States and it would become
the exclusive developer and manufacturer of equipment for the
Bell telephone companies that operated the United States
telephone network. In 1907, AT&T (formerly American Bell)
and Western Electric engineering departments were combined into
a single organization that, in 1925, would become Bell Telephone
Laboratories and generate some of the most significant
scientific and technological discoveries of the
20th century.

Effective January 1, 1984, AT&T agreed to divest its
local Bell telephone companies. As part of this divestiture, a
new unit, AT&T Technologies, assumed Western Electrics
charter. In 1989, AT&T Technologies branched into several
business units, which would all later combine with Bell Labs to
become the original Lucent Technologies.

AT&T launched Lucent in April 1996 with an initial public
offering. The spin-off was completed in September 1996 when
AT&T distributed its shares of Lucent to AT&T
shareholders.

Strategy for Growth

Our goal is to create new possibilities to enhance peoples
lives by transforming the way the world communicates. Our
mission is to be the partner of choice for the worlds
leading service providers, governments and enterprises by
helping them create, build and maintain innovative, reliable and
cost-effective communications networks that meet their
customers growing needs through the rapid deployment of
new communication services. Our vision for the market is
converged services  creating networks that deliver
communications services that are simple, secure and seamless,
personal and portable, for people at work, home or anywhere in
between.

Our strategy for profitable growth is based on bringing to
market comprehensive next-generation network solutions that
satisfy the increasing end-user demand for converged services.
To that end, we have been making strategic investments in key
next-generation segments, such as third-generation or 3G
mobility, Internet Protocol Multimedia Subsystem (IMS),
next-generation optical, Ethernet over Optical, broadband
access, managed and professional services, voice over Internet
Protocol (VoIP) and multimedia applications.

3



---



##### Table of Contents

Based on analysts research and our internal estimates, we
expect these to be some of the fastest-growing segments in our
industry and we expect them to grow faster than the overall
market through 2009, with most of the growth beginning during
2007-2008.

Our strategic choices remain tightly aligned with these growth
opportunities. For example, in 3G mobility, we are investing in
CDMA2000 (Code Division Multiple Access) and 1xEV-DO (Evolution
to Data Optimized), as well as UMTS (Universal Mobile
Telecommunications System) and HSDPA (High-Speed Downlink Packet
Access), which are all spread-spectrum technologies. These
technologies provide large bandwidth, high-speed data rates and
flexible routing for high quality transmission of multimedia and
advanced global roaming capabilities that are increasingly in
demand. In next-generation optical, we are investing in data
over optical solutions, specifically Ethernet over Optical in
metropolitan areas, as well as in the intelligent transport and
switching of data traffic. These solutions allow service
providers a flexible, cost-effective way to increase network
bandwidth and to deploy scalable, reliable and secure Ethernet
connectivity, such as virtual private networks (VPN). In
broadband access, we are investing in technologies that support
IPTV (Internet Protocol Television), which delivers broadcast
television or video on demand over a variety of communications
networks and devices. A number of our multimedia products
currently support IPTV, and our recently announced
next-generation multimedia access platform supports IPTV over
fiber, copper and WiMAX (Worldwide Interoperability for
Microwave Access).

We are also investing in some of the highest-growth segments
within services, such as professional, managed and hosted
services. With the creation of next-generation communications
networks becoming a market reality, our services business under
Lucent Worldwide Services (Services) has a broad range of
solutions to address the challenges of evolving complex networks
and managing network integration. More specifically, these
network transformation services provide service providers and
enterprises with a set of solutions aimed at enabling migration
from existing network infrastructure to next-generation
architectures and the cost-effective delivery of converged
voice, data and video services anytime and anywhere over a
common core transport network. In addition, our new hosted
solution offerings are targeted to service providers of all
sizes who are looking to increase speed to market and
differentiate their services. The services operated and managed
from one of our four Global Network Operations Centers can be
either completely hosted at our facilities or managed remotely
from customers sites.

The IMS architecture is the cornerstone of our vision of
next-generation networks. IMS, which cuts across these
aforementioned high-growth areas, is an open Internet Protocol
or IP-based solution for next-generation networks to deliver
voice, data and video services seamlessly across wireless,
wireline and converged networks. It is the common platform that
supports many of the areas in which we are investing. This
architecture allows carriers to differentiate themselves by
customizing their service architectures to the specific
communications needs of their customers.

We believe the market demand for converged real-time
communications services will drive service providers to invest
in their IMS core network. We believe that Lucent is a leader in
IMS because our solution incorporates Lucents strong
heritage of understanding service provider networks with Bell
Labs innovations. That combination has created a common platform
that cuts across both wireless and wireline, across voice, data
and video, and provides services wherever and whenever an
end-user demands. Lucent has introduced 19 new products,
applications and Bell Labs technologies that support our common
platform approach to IMS across our entire wireline and wireless
portfolio.

To us, IMS is largely about delivering the blended
communications services that end-users demand. Next-generation
applications are creating these services by combining voice,
video and data capabilities, and delivering them on both
wireless and wireline networks. This year we introduced new
applications which have been well-received by our customers,
such as:




    Active Phonebook, an advanced personal directory service that
    provides a common, unified phonebook that tracks and centralizes
    contact data across different communications devices.
    iLocator, which uses location and presence technology to alert
    users when friends or family or points of interest are in their
    vicinity.4



---



##### Table of Contents

In addition, we believe our vision and our IMS solutions are
gaining acceptance with customers. Thus far, we have announced
contract wins for our IMS-based solutions and portfolio with
BellSouth, Cingular Wireless, SBC Communications and Sprint in
the United States, Netia and O2 in Europe and Shandong Unicom, a
subsidiary of China Unicom, in China. In addition to these
publicly announced wins, we currently have 43 trials ongoing for
our IMS-based network elements with 13 customers, and we are
particularly encouraged by the increased number of trials and
discussions under way with customers outside the
U.S. Although we do not expect revenues from IMS contracts
to be material in fiscal 2006, we expect to continue to
gradually convert IMS trials into deployments.

By continuing to deploy core IMS network solutions we have
achieved a major step in realizing our vision and are now able
to focus more of our efforts and resources on bringing to market
the IMS adjacencies  the products and
services that are enabled by and deployed on a core IMS network.
We believe Lucent is well positioned to realize accelerated
growth and profitability associated with the broader IMS
opportunity by providing our customers with IMS-enabled products
and services in areas such as applications, services, content
delivery, VoIP, mobile high-speed data, next-generation optical
networking, broadband access as well as integrated operating
support systems and business support systems services.

We believe our customers success depends in part on the
evolution of their business models and their networks both to
generate new revenue streams and to more efficiently manage
their network costs. Increasingly, we believe our customers need
the depth and expertise of Services, as they evolve their
networks and determine future needs. We believe Services is
becoming a network integrator of choice across many service
offerings  from business case modeling to other
professional services such as network planning and design,
installation, integration, optimization and maintenance.

We are also expanding our customer list and broadening our
revenue base by winning new business in such growth segments as
the government sector and enterprises, as well as emerging
markets outside the United States.

In the government sector, we look to achieve continued growth
via the pursuit of opportunities in the areas of converged
services, secure solutions, disaster recovery and public safety.
In the enterprise market, we are focused on bringing the
benefits of convergence to the business user. We continue to
focus on emerging markets, which we believe will offer
opportunities as communications networks enable economic
development. During fiscal 2005, 37 percent of our total
revenue was generated from customers outside the United States,
including emerging markets, and we announced contract wins in
China, Korea, Japan, Singapore, Australia, New Zealand, Saudi
Arabia, Russia, Kazakhstan, the Czech Republic, Poland, Mexico,
the Cayman Islands and Brazil.

This fiscal year, we realigned business operations to advance
our profitable growth strategy. We combined our mobility and
wireline businesses into a single unit called the Network
Solutions Group (NSG) to best meet our customers demand
for converged services, while continuing to make strides in
managing our expenses. This new alignment is a natural extension
of the common platform development work we have had underway to
improve our time to market, efficiency and cost structure. Our
wireline and wireless businesses had been already collaborating
on several efforts that include joint product development teams,
joint offer teams and joint applications teams, and we already
had a global sales team that cuts across the businesses.

This more integrated approach should benefit us in several ways,
including:




    Drive our business with a more integrated view, where
    appropriate, and leverage our collective strengths across all
    our product offerings to optimize opportunities in the market.
    More efficiently deliver a common set of IMS-based solutions to
    our customers that will help them expand their revenue bases.
    Improve our speed, innovation and time to market by streamlining
    our supply and design chains and shortening our product
    development cycles.5



---



##### Table of Contents

Communications Equipment and Services Market

Market Environment

Our service provider customers operate in a fast-changing
environment driven by new technology, increased competition and
regulatory change. End users are demanding fast, personalized,
easy-to-use communications and are relying on new applications
in both their professional and personal lives. These
applications and services are enabled by technologies such as
mobile high-speed data, broadband access, next-generation
optical networking, VoIP and multimedia converged services. Our
strategy and portfolio are focused on identifying and
capitalizing on these growth opportunities, and we believe that
demand for these new applications and services will drive
profitable growth for both the service providers and Lucent.

In many regions, regulatory changes continue to influence the
telecommunications industry. These changes in telecommunications
law were designed to liberalize closed markets, encourage
competition, create new services and stimulate demand.
Historically, this changing legislative landscape has created
uncertainty, particularly in the United States. Depending on the
situation, it has caused acceleration, postponement or
cancellation of major network investments and upgrades by
certain customers. Rulings by the Federal Communications
Commission in the United States and other government regulatory
bodies in foreign countries appear to provide a favorable
environment for a new breed of high-speed access
(broadband) as well as VoIP services. However, the delay of
3G license awards in China could continue to have a negative
impact on future network investments in that country.

These factors have resulted in telecommunications operators
managing their businesses based on more moderate revenue
forecasts and generally less robust economic outlooks. Service
providers continue to focus on cutting operational costs,
reducing debt, expanding new services and improving the security
and reliability of their networks as they look to adapt to a
changing regulatory environment.

Our addressable market spans the following market
segments  voice switching, data networking, optical
networking, access, mobility, operating support systems
software, applications, and services. Key next-generation
segments  managed and professional services, 3G
mobility, applications, and VoIP  are expected to
grow faster than the overall market through 2009. The
addressable market for IMS spans all of these fast growing
segments. While opportunities are more limited and smaller than
in the past, we believe a large market opportunity still remains
for leading telecommunications equipment vendors to help
customers address their business needs.

Consolidation

Consolidation among service providers is an industry dynamic
that may continue as carriers look to expand the scope and scale
of their networks, while improving cost efficiencies. This
dynamic will continue to lead to both challenges and
opportunities for equipment vendors. One potential challenge may
come in the form of rationalized capital spending. A potential
opportunity may lie in helping carriers integrate their large,
complex networks. And depending on the service providers
involved, some of the consolidation might enable a vendor to
extend its reach into customers that were previously focused on
different technologies and not a large part of that
vendors historical revenues.

Competition

The global telecommunications networking industry remains highly
dynamic and competitive. Our current principal competitors
include Alcatel, Ciena Corporation, Cisco Systems, LM Ericsson
Telephone Company, Fujitsu Limited, Huawei Technologies,
Motorola, NEC Corporation, Nokia Corporation, Nortel Networks
Corporation, Samsung Networks, Siemens, UT Starcom, and ZTE
Corporation. Some of our competitors, such as Alcatel and
Nortel, compete across many of our product lines, while others
compete in a small subset of our products.

We expect that the level of competition will continue to
intensify, for several reasons. First, we believe most industry
participants will seek to strengthen their relationships with
large service providers, as these providers currently represent
approximately 75% of global carrier spending. In addition,
carrier consolidation continues, resulting in fewer customers.
Competition is also accelerating around converged network
technologies as carriers are shifting capital to areas that will
enable network migration. Furthermore, competitors providing
low-priced products and services from Asia are gaining market
share worldwide. As a result, we continue to operate in an
environment of increased competitive pricing.

6



---



##### Table of Contents

Reportable Segments

Although Lucents new organizational structure was
announced earlier this year, our segment reporting structure
remained unchanged for fiscal 2005, and we will report under our
new segment structure beginning with the reporting of first
quarter 2006 results. The reportable segments for fiscal 2005
were Mobility Solutions, Integrated Network Solutions (INS) and
Lucent Worldwide Services (Services). Mobility Solutions
provided software and wireless equipment to support radio access
and core networks. INS provided a broad range of software and
wireline equipment related to voice networking (primarily
consisting of switching products, which we sometimes refer to as
convergence solutions, and voice networking products), data and
network management (primarily consisting of access and related
data networking equipment and operating support software) and
optical networking. Voice networking, data and network
management and optical networking products are an integral part
of our customers networks and the foundation for our
IMS-based solutions. The Services segment represents a worldwide
services organization that provides deployment, maintenance,
professional and managed services in support of our product
offerings as well as multivendor networks. Financial information
about these segments and by geographic areas is set forth in
Note 11 to our Consolidated Financial Statements and our
Managements Discussion and Analysis of Financial Condition
and Results of Operations contained in this report.

Mobility revenues were approximately $4.6 billion during
fiscal 2005. A significant portion of Mobilitys revenues
was derived from a few large service providers in the
U.S. Verizon Wireless and Sprint combined accounted for 63%
and 60% of total Mobility revenues during fiscal 2005 and 2004,
respectively. As of September 30, 2005, Mobility had
approximately 5,200 full-time employees engaged mainly in
product development, general management and marketing activities.

INS revenues were approximately $2.6 billion during fiscal
2005 and were primarily from large, established service
providers. As of September 30, 2005, INS had approximately
4,600 employees, primarily engaged in product development,
marketing and general management activities.

Services revenues were approximately $2.1 billion during
fiscal 2005. As of September 30, 2005, Services had
approximately 10,600 employees dedicated to professional
services, managed services, deployment services and maintenance
services.

Financial information about our products is set forth in our
Managements Discussion and Analysis of Financial Condition
and Results of Operations contained in this report.

Organization of the Business

Effective October 1, 2005, our reportable segments are
Mobility Access Solutions, Multimedia Network Solutions and
Converged Core Solutions, which are all within NSG; Lucent
Worldwide Services, which includes our network operations
software unit formerly included in INS; and Other. These
segments are organized around the products and services we sell.

Mobility Access Solutions

Mobility Access Solutions is focused on providing 3G network
technologies based on CDMA2000, W-CDMA/ UMTS (Wideband CDMA/
Universal Mobile Telecommunications System) and CDMA 1xEV-DO
spread-spectrum solutions that supply wireless service providers
large bandwidth, high-speed data rates and flexible routing for
high quality transmission of multimedia and advanced global
roaming. CDMA2000 is a globally deployed wireless technology,
predominantly used in North America, Asia Pacific and portions
of South America that enables CDMA operators to deliver
high-quality voice and mobile high-speed data services. W-CDMA/
UMTS enables GSM operators to deliver these same capabilities.
CDMA 1xEV-DO is the next step for evolving to the 3G standard
and is for transmitting high-speed data only.

7



---



##### Table of Contents

Our wireless customers worldwide continue to add voice
subscribers and minutes of use to their networks, so voice
capacity continues to be a very important driver in their
network investment. At the same time, their voice revenues are
under pressure from increased competition and this is driving
investment in 3G network solutions that bring new mobile
high-speed data capabilities to their networks. Thus, much of
our current wireless growth and a focus of our customers is
related to 3G mobile high-speed data network deployments, which
consist of upgrading existing base stations and - in some
cases - providing new base stations and other equipment
that enable operators to introduce mobile high-speed data
services at rates comparable to wireline connections.

The International Telecommunications Union, an international
standards body that operates as part of the United Nations, has
been instrumental in promulgating a vision of 3G that embraces a
wide variety of spread-spectrum technologies, including those we
have helped develop. We continue to be the global leader in CDMA
spread-spectrum networks, with more than 140,000 base stations
providing commercial service around the world. Approximately
90,000 of those base stations provide 3G services for our
customers today. We have deployed these networks with more than
35 customers on the continents of North and South America, Asia,
Europe and in the Australia/ New Zealand region.

We currently have 16 commercial CDMA2000 1xEV-DO customers,
helping them deliver mobile high-speed data services at speeds
of up to 2.4 Megabits per second. For W-CDMA/ UMTS, Cingular
launched the worlds first commercial HSDPA network with
Lucent-supplied equipment in the Phoenix and Seattle markets and
O2 and Manx Telecom launched Europes first commercial
HSDPA network with Lucent-supplied equipment on the Isle of Man.
HSDPA is an evolution of UMTS networks that support very high
speed data connections on mobile networks. We also completed the
first field trial of HSDPA technology in China on a W-CDMA trial
network deployed by China Netcom in Shanghai.

We expect wireless operators to upgrade their networks in the
future to support VoIP and IMS-enabled services with
technologies such as CDMA2000 1xEV-DO Revision A technology and
high-speed uplink packet access technology for W-CDMA/ UMTS
networks. These technologies make the introduction of VoIP
services on mobile networks more efficient and increase the data
speeds and capacity of 3G networks.

We are dedicated to helping wireless service providers capture
the market opportunities being created by the growing demand for
blended lifestyle services. Our customers are
interested in introducing IMS-enabled services that blend voice,
data and video capabilities to create next-generation service
applications such as video telephony or real-time gaming
delivered to subscribers anytime, anywhere and in ways that
enhance their lifestyles.

Verizon Wireless and Lucent recently announced the completion of
the wireless industrys first, live, over-the-air calls
using CDMA2000 1xEV-DO Revision A technology. The two companies
plan to conduct a more extensive technology trial in early 2006,
which will include the delivery of VoIP and new, blended
lifestyle services and simultaneous multimedia applications that
combine voice, data and video capabilities such as video
telephony.

The most important products in Mobilitys CDMA2000 and
W-CDMA/ UMTS portfolios are developed internally, including
radio access products, circuit and packet core backbone
networks, and network management, application and service
delivery systems. Mobility also taps into our strengths in voice
networking, data and network management and optical networking,
and leverages the expertise of Services. We have worked and will
continue to work with other equipment vendors to help us offer
best-in-class, end-to-end solutions and products.

Key Mobility Products

Base station products provide the radio links that transmit and
receive wireless subscriber calls and manage handoffs as
customers move from cell to cell (a cell is the area in which
calls are handled by a particular base station). Each radio base
station covers a specific geographic area and has the capacity
to handle a certain amount of subscriber traffic. Our base
station platform supports both CDMA2000 and W-CDMA/ UMTS
technologies and addresses the form, fit and function of future
assemblies in a modular fashion. Therefore, many current base
station products may be used as the cell evolves to include
expanded capacity for wireless voice and/or data transmissions.
Core network equipment connects base stations to the public
voice and data networks. Our Converged Core Solutions develops
the majority of these voice and packet data core switching
network equipment, which can support IMS-enabled services.

8



---



##### Table of Contents

Applications Solutions

Applications Solutions will be reported as part of the Mobility
Access Solutions segment and centralizes Lucents
development of software applications that enable Lucent
customers to deliver advanced communications services to their
subscribers. The Applications Solutions Group supports
traditional applications, such as the widely deployed AnyPath
messaging system and SurePay system, as well as new IMS
applications, based on innovative Bell Labs technology, which
deliver blended lifestyle services to subscribers.

Key Applications Solutions Products

Lucent AnyPath® Messaging System integrates existing call
answering and voice messaging capabilities with a wide array of
new and emerging media-rich applications, including: advanced
multimedia, mobile data, unified communications, speech-enabled
and real-time voice portal applications. In addition, the
AnyPath Messaging System provides continuous new application
development to assist in the quick and efficient deployment of
innovative differentiated services for subscribers.

MiLife® SurePay® Solutions Suite collects charging
information from various network elements and supports rapid
deployment of new rating plans and sales promotions, to help
service providers respond quickly to changing market
requirements.

Multimedia Network Solutions

The Multimedia Network Solutions (MNS) develops optical, data
and broadband access solutions for wireline networks, with
special focus on providing end-to-end solutions that enable
service providers to offer blended multimedia subscriber
services over intelligent network infrastructures.

The optical unit builds laser-based transmission and switching
systems that transport information using pulses of light. These
systems include core backbone high-capacity systems for fast,
efficient transport of information over long distances;
intelligent optical switches and cross-connects in the center of
the network that aggregate and bridge metropolitan area traffic
for transport over long-haul and ultra-long haul optical
networks; and metropolitan optical systems that aggregate and
increase the use of fiber optic systems for both voice and data
traffic in metropolitan or regional areas.

Our optical systems are based on industry standards that promote
interoperability and allow customers to use some of their
existing investments. Lucents integrated optical network
management of single and multi-vendor networks through
Navis® Optical Management solutions gives customers
cost-effective maintenance and operations support and multiple
protection options, which help increase reliability. Our modular
designs help customers achieve cost savings through improved
space and power requirements.

The data and access units provide to large scale, reliable, and
secure broadband access and next-generation data networks
solutions for the deployment of unique and personalized blended
lifestyle services. The data business leverages the large
embedded base of Lucent Asynchronous Transfer Mode (ATM) and
Frame Relay switches in helping customers evolve to IP/
Multiprotocol Label Switching (MPLS) core data networks. The
data business partners with other vendors to provide IP and
Ethernet edge solutions as required. In addition, the access
business provides a competitive IPTV/ IP Multimedia access
solution to enable blended lifestyle services.

Key Multimedia Network Products

The
LambdaUnitetm
MultiService Switch is a compact, global, next-generation
optical transport system and switch that provides a bridge
between data-intensive metro networks and high-speed optical
core networks, connecting cities, campuses and corporate
networks to the larger, long-haul public networks.

The
LambdaXtremetm
Transport System is 3G long-haul optical networking system that
can transmit very large amounts of information across continents
at one of the lowest costs per bit per kilometer in its class.
LambdaXtremetm

9



---



##### Table of Contents

Transport is a dense wave division multiplexing system that
supports new ring architectures as well as traditional
span-to-span networks.

Lucents Metropolis optical systems are metropolitan area
networking systems that provide a simple, differentiated way for
our customers to data-enable their installed base of SONET/ SDH
systems, giving our customers the ability to generate new
revenues by supporting Ethernet data transport over SONET/ SDH
networks that formerly were used to carry only voice traffic.

The CBX 3500 Multiservice Edge Switch uses the same software as
our existing Multiservice GX 550 and CBX 500 switches and is
designed for seamless insertion into operating networks to
minimize operating expenses during network expansion. We have
higher-capacity cards for the CBX 3500, offering additional
capabilities to support high-bandwidth IP, ATM and Frame Relay
edge services. All of these switches are widely deployed across
the globe.

The Stinger DSLAM products provide high-speed Digital Subscriber
Line (DSL) services in multiple network deployments. We believe
these products are ideally suited for IP video broadcast and
pay-per-view deployments because of their multicast
capabilities, which limit the amount of optical bandwidth
carriers must provide between the central office and the remote
location, thereby reducing expenses. Stinger DSLAMs are a
critical component of todays largest commercial IPTV
deployment.

The AnyMedia Access Platform is a next-generation Digital Loop
Carrier system, widely sold outside the U.S. to support
mixed deployments of circuit switched voice lines and broadband
DSL. Anymedia is an IP Line Gateway that carriers may deploy to
migrate from Class 5 switches to soft switches.

Converged Core Solutions

Converged Core Solutions (CCS) provides next-generation
switching solutions, such as IMS core products, and traditional
switching solutions (i.e., 5ESS® switches) for service
providers, government, and enterprise customers.

CCS products are part of the Lucent IMS solution that enables
service providers to offer blended lifestyle
services  advanced, converged lifestyle-enhancing
applications over wireless and wireline networks 
that consumer and enterprise customers demand.

CCS is focused on demonstrating Lucents leadership in
next-generation technology and providing a next-generation core
solution that delivers value over IP, such as blended lifestyle
services, and enables Lucent to offer complete solutions that
include other NSG products and services.

Key Converged Core Products

The Lucent 5ESS® switch is a central component in
traditional telephone networks around the world. The 5ESS®
switch is a modular, digital communications hub for
circuit-switched voice traffic. We are actively engaged with our
traditional voice networking customers to help them evolve their
5ESS® circuit-switched platforms to increase capacity,
lower cost of operations, accelerate new feature
introductions  such as support for Personal
Handyphone Systems (PHS) popular in China and Japan 
and lay the groundwork for the introduction of packet-based IP
transport and IMS-based services. PHS is an extension of a
wireline network that uses a wireless telephone similar to a
cordless phone and provides mobility and extended-range voice
and data services.

The Lucent Compact Switch can support from as few as 1,000
subscribers to more than 100,000 subscribers on a single
integrated platform. Service providers can deploy the switch for
end-office (Class 5) and tandem (Class 4) applications
to replace an existing switch or as an addition to the network.
In addition to providing VoIP, Internet off-load and gateway
mobile switching center features, the Lucent Compact Switch also
offers capabilities compliant with U.S. electronic
surveillance and enhanced 911 rules. The switch also can serve
as a building block for carriers that choose to migrate to an
IMS-based network to offer blended lifestyle services.

10



---



##### Table of Contents

The Lucent Session Manager provides multiple IMS functions and
forms the core of Lucents IMS architecture and manages
user presence and call types, dynamically connecting subscribers
to a variety of services in an IMS-based network.

The Lucent Network Gateway provides the IMS media gateway
function and permits seamless interaction between IP networks
and both traditional wireline and wireless networks.

The Lucent Feature Server enables consumer, business and
wireless services, on both IMS-based and non-IMS based networks,
including the new application feature server that supports a
variety of telephony and mobility services on broadband or
narrowband networks.

The Lucent Network Controller is an element in Lucents
IMS-based solution, which provides the media gateway control
function and the signaling gateway function. These VoIP
functions were previously associated with traditional
softswitches.

The 5E-XC is an upwardly compatible switch designed to help
customers migrate from circuit-switched to packet-switched
networks. For example, 5E-XC access frames can be put under
software control, saving service providers from buying new
network gateways. The
5E-XCtm
IP Card supports SIP - an industry-wide protocol that
simplifies the development and delivery of IP services. The
5E-XCtm
Optical Interface Unit reduces equipment space by 75% and power
consumption by 70% in a central office. It also provides a
ten-fold increase in the number of trunks per cabinet or rack
that the switch supports.

Lucent Worldwide Services

Services provides professional services, managed services,
deployment services and maintenance services. Our planning,
design, optimization, integration and management services are
critical to simplifying convergence and empowering service
providers to bring profitable lifestyle-changing services to end
users, while driving increased revenues. Services is
increasingly providing these services in a multivendor
environment  networks that utilize equipment from
numerous other vendors.

Services leverages its core competencies, drawing on the
expertise and the innovation of Bell Labs to address this
opportunity. Services offerings are provided in combination with
Lucent products, as well as services that are offered
stand-alone or based on other vendors products. We intend
to increase our international presence and capabilities and have
plans to penetrate new markets adjacent to the core service
provider market, such as government, enterprise, and cable
markets.

Professional Services

These services help our customers, which include government
customers, identify network areas where they can capitalize on
high-margin opportunities, apply proven tools and techniques to
optimize performance and reduce operating expenses, and plan
evolution to protect their network investment and increase
profits. Enhanced engineering services help our customers
determine the best configuration for maximizing traffic capacity
and for achieving other operational efficiencies. These services
also provide our customers with in service upgrades
to help them migrate to new technologies. Enhanced technical
services help carriers maintain a high-performing network by
identifying and correcting network performance issues, balancing
traffic loads and integrating new multivendor equipment and
software into a live system. Professional services improves our
customers network quality by troubleshooting, by reporting
and resolving problems and by providing on-the-job training to
their staff. Professional services revenues accounted for
approximately 32% of fiscal 2005 Services revenues.

Deployment Services

These services help our customers bring their equipment online
in an efficient manner and allow them to begin generating
revenues more quickly. Equipment and field engineering services
provide analysis, identification and documentation of detailed
hardware and software specifications for new multivendor
networking equipment to help ensure smooth deployments.
Deployment services build and expand wireline and wireless
networks globally and provide on-site configuration,
testing and network connectivity of the equipment following
installation. Our site location and construction services
provide a complete network deployment solution and include site
acquisition, construction management, architecture and
engineering, site construction, inspection service and network
infrastructure support. Deployment revenues accounted for
approximately 29% of fiscal 2005 Services revenues.

11



---



##### Table of Contents

Maintenance Services

These services help our customers maximize the performance of
their multivendor networks and maintain network reliability and
availability to ensure quality of service. We have the
capability to provide technical support either remotely via
phone or modem for rapid response, diagnosis and resolution or
on-site through technical specialists supplementing the service
providers staff. Maintenance revenues accounted for
approximately 38% of fiscal 2005 Services revenues.

Managed Services

These services consist of a wide range of outsourced network
operations and network transformation services that help our
clients reduce their operating expenses while preserving and
enhancing network reliability. Managed services provide a
seamless transition to an outsourced environment utilizing
state-of-the-art tools and technology plus highly skilled
technicians to provide ongoing network management of our
customers networks. These functions can be performed at
our global network operations centers or at the customers
network operations center. We currently provide network
operation services to more than 25 customers around the world.
Although these revenues do not represent a significant portion
of Services revenues, managed services are often embedded in
deployment, maintenance and professional services.

By relying on our global multivendor expertise and field-proven
processes, our customers can leverage their installed base of
assets across multiple technologies and vendors, quickly
implement new technologies and applications to expand presence
in target markets, and simplify operations through customized
support to design, build, and manage communication networks.

Research and Development

Bell Labs, one of the worlds largest research and
development organizations focused on communications-related
technology, supports all of our segments. Bell Labs provides
basic and applied research and development support for our
business. Bell Labs mission is to develop technically
advanced products and services that will keep us at the
forefront of communications, to conduct fundamental research in
scientific fields important to communications and to create
innovations that can be put to use in our new communications
products and services. Bell Labs research activities
continue to focus on the technologies we view as central to our
business strategy: software, network design and engineering,
network services, photonics, optical, data networking and
wireless communications. Bell Labs looks at both near-term and
long-term opportunities, actively working on current product and
service research and development as well as fundamental
scientific breakthroughs that may be ten or more years out on
the horizon.

Protecting both global communications networks and the people
that use them remains a top priority as we work to deliver on
the promise of next-generation networking. The industrys
migration to an all-IP architecture means that our customers
face a host of new network and user vulnerabilities not present
in the closed, circuit-switched telephony world. Addressing
these vulnerabilities becomes even more difficult when
compounded by the large number of vendors and service providers
that are working on an increasing number of standards and
technologies across multiple networks. To address this
challenge, Bell Labs has intensified its focus on the aspects of
security that are most relevant to meeting the needs of the
market.

Bell Labs has increased its work on technologies to further the
development of our IMS architecture. We plan to continue to
invest in the R&D efforts of Bell Labs because we believe it
gives us a competitive advantage in developing innovative
technologies. There are more than 9,000 employees in Bell Labs,
which includes R&D, services and technical staff. Most of
these employees serve in R&D roles in our Mobility Access
Solutions, Multimedia Network Solutions and Converged Core
Solutions segments. There are approximately 1,100 employees
supporting research efforts within Bell Labs core research
group. Overall, researchers at Bell Labs have received: six
Nobel Prizes in Physics, nine U.S. National Medals of
Science and seven U.S. National Medals of Technology. In
addition, our scientists and engineers have earned more than
31,000 patents since 1925.

12



---



##### Table of Contents

Building on this heritage, we believe our researchers continue
to be leaders in the field of mobile communications research,
including breakthroughs in wireless high-speed data, efficient
use of mobile spectrum and personal privacy. Our customers
depend on Bell Labs across a wide range of business and
technical issues. Whether its improving operations,
lowering costs, or sharing insight about the future of
communications, Bell Labs experts are frequently called upon for
their valuable insight.

In addition to Bell Labs and our internal development, we also
consider partnerships, strategic alliances and acquisitions to
be important resources for research and development that will
help us execute our business strategy.

With the industry showing signs of stability, we have considered
strategic acquisitions, such as our 2004 acquisition of Telica,
a provider of VoIP communications systems for next-generation
networks, to complement our business strategy.

Our research and development costs are discussed in our
Managements Discussion and Analysis of Financial Condition
and Results of Operations contained in this report.

Supply Chain Networks

Supply Chain Networks, or SCN, manages our end-to-end global
supply chain, which is needed to produce and deliver our
products and services to our worldwide customers. The
organization designs, implements and optimizes the supply chain
for our products, with the goal of establishing product cost,
product cycle and interval, and quality that meet our objectives
and those of our customers. SCN identifies suppliers needed to
support our product lines and ensures continuity of supply at
the required price and quality.

We make significant purchases of components and other materials
from many U.S. and non-U.S. sources. While there have been
some shortages in components and some other materials in
technology commodities common across the industry, we have
generally been able to obtain sufficient materials and
components from various sources around the world to meet our
needs. We also develop and maintain alternative sources for
essential materials and components. We do not have a
concentration of sources of supply of materials, labor or
services that, if suddenly eliminated, could severely impact our
operations.

We currently use contract manufacturers to supply most of our
product lines, but we continue to integrate and test internally
many of these products. Celestica Corporation manufactures most
of the wireless products we design and we are transitioning to
Solectron Corporation the manufacture of most of the wireline
products we design. Our contract manufacturers also include
other local companies in various regions. SCN controls the
source selection for all significant or strategic components.
Our contract manufacturers use their leverage and global buying
power to negotiate prices from vendors we approve. SCN monitors
their performance to ensure process and technical product
specifications are met.

Global Sales Organization

Our Global Sales Organization (GSO) is the primary interface to
our customers around the world. The organization is responsible
for managing the relationships with our customers and selling
solutions to help them quickly deploy next-generation
communication networks that create new revenue-generating
opportunities and enable them to better manage their networks.
Services also maintains a direct sales force outside of North
America that supplements the sales effort of GSO.

13



---



##### Table of Contents

Corporate Centers

Our corporate centers provide centrally managed but locally
deployed corporate support groups that include cash management,
legal, accounting, tax, public relations, insurance,
advertising, human resources and information technology services.

Backlog

Our backlog was $1.9 billion and $2.1 billion as of
September 30, 2005 and 2004, respectively. Substantially
all of the orders included in the September 30, 2005
backlog are scheduled for delivery during fiscal 2006. However,
customers may reschedule their orders, which would delay the
associated revenues. Further, although we believe that the
orders included in the backlog are firm, customers may be able
to cancel some orders without penalty, and we may elect to
permit cancellation of orders without penalty where management
believes that it is in our best interest to do so. Some
customers may also become unable to finance their purchases as a
result of deterioration in their financial position.

Seasonality

Our revenues and earnings have not demonstrated consistent
seasonal characteristics.

Patents, Trademarks and Other Intellectual Property Rights

We have patents to protect some of our innovations and
proprietary products and technology. We market our products and
services primarily under our own names and marks. We consider
our patents and trademarks to be valuable assets. Many of our
trademarks are registered throughout the world. We currently own
approximately 7,000 patents in the United States and 8,100
patents in foreign countries. The foreign patents are, for the
most part, counterparts of our U.S. patents.

Our intellectual property licensing division licenses, protects
and maintains our intellectual property and enforces our
intellectual property rights. This responsibility includes
licensing our patents and technology to third parties and
negotiating agreements regarding our licensing of intellectual
property from others. Many of our patents are licensed to other
companies with large patent portfolios, and we are licensed to
use patents owned by these other companies, including our former
affiliates, Agere, AT&T, Avaya and NCR. The terms of these
cross-licenses may vary.

We rely on patent, trademark, trade secret and copyright laws
both to protect our intellectual property, including our
proprietary technology, and to protect us against claims from
others. We believe that we have direct intellectual property
rights or rights under cross-licensing arrangements covering
substantially all of our material technologies. However, third
parties may assert infringement claims against us or against our
customers in connection with their use of our systems and
products. When infringement claims are made against our
customers or us, the outcomes of these claims are sometimes
difficult to predict because of the technological complexity of
our systems and products.

Forward-looking Statements

This annual report on Form 10-K and other documents we file
with the SEC contain statements about future performance, events
or developments, which are also known as forward-looking
statements. Forward-looking statements are based on
current expectations, estimates, forecasts and projections about
us, our future performance and the industries in which we
operate as well as on our managements assumptions and
beliefs. Statements that contain words like expects,
anticipates, targets, goals,
projects, intends, plans,
believes, seeks, estimates
or variations of such words and similar expressions are
forward-looking statements. Since they relate to future
developments, results or events, these statements are highly
speculative and involve risks, uncertainties and assumptions
that are difficult to assess. You should not construe any of
these statements as a definitive or invariable expression of
what will actually occur or result. Actual outcomes and results
may differ materially from what is expressed or forecasted in
such forward-looking statements. We describe in the next section
some of those risks and uncertainties associated with our
business. Except as required under the federal securities laws
and the rules and regulations of the SEC, we do not have any
intention or obligation to update publicly any forward-looking
statements in this Form 10-K after its distribution, even
if new information, future events, changes in assumptions or any
other reason would alter those statements.

14



---



##### Table of Contents

Risks Related to Our Business

Our business, our future performance and forward-looking
statements are affected by general industry and market
conditions and growth rates, general U.S. and
non-U.S. economic and political conditions (including the
global economy), interest rate and currency exchange rate
fluctuations and other events. The following items are
representative of the risks, uncertainties and other conditions
that can impact our business, our future performance and the
forward-looking statements that we make in this report or that
we may make in the future.

We Operate in a Highly Competitive Industry with Many
Participants. Our Failure to Compete Effectively Would Harm Our
Business.

We operate in a highly competitive environment in each of our
businesses, competing on the basis of product offerings,
technical capabilities, quality, service and pricing.
Competition for new service providers and enterprise or business
customers as well as for new infrastructure deployments is
particularly intense and increasingly focused on price. We
believe we offer potential customers many benefits in addition
to competitive pricing, including strong support and integrated
services for quality, technologically-advanced products,
however, in some situations, we may not be able to compete
effectively if purchasing decisions are based solely on the
lowest price.

We have a number of existing competitors, some of which are very
large, with substantial technological and financial resources,
brand recognition and established relationships with global
service providers. Some of our competitors have very low cost
structures, support from governments in their home countries, or
both. In addition, new competitors may enter the industry as a
result of shifts in technology. These new competitors, as well
as existing competitors, may include entrants from the
telecommunications, computer software, computer services, data
networking and semiconductor industries. We cannot assure you
that we will be able to compete successfully against existing or
future competitors. Competitors may be able to offer lower
prices, additional products or services or a more attractive mix
of products or services, or services or other incentives that we
cannot or will not match or do not offer. These competitors may
be in a stronger position to respond quickly to new or emerging
technologies and may be able to undertake more extensive
marketing campaigns, adopt more aggressive pricing policies and
make more attractive offers to potential customers, employees
and strategic partners.

Technology Drives Our Products and Services. If We Fail to
Keep Pace with Technological Advances in Our Industry, or If We
Pursue Technologies That Do Not Become Commercially Accepted,
Customers May Not Buy Our Products or Use Our Services.

The telecommunications industry uses numerous and varied
technologies and large service providers often invest in several
and, sometimes, incompatible technologies. The industry also
demands frequent and, at times, significant technology upgrades.
Furthermore, increasing our services revenues requires that we
develop and maintain leading-edge tools. We do not have the
resources to invest in all of these existing and potential
technologies. As a result, we concentrate our resources on those
technologies we believe have or will achieve substantial
customer acceptance and in which we have appropriate technical
expertise. However, existing products often have short product
life cycles characterized by declining prices over their lives.
In addition, our choices for developing technologies may prove
incorrect if customers do not adopt the products we develop or
if those technologies ultimately prove to be unviable. Our
operating results depend to a significant extent on our ability
to maintain a product portfolio and service capability that is
attractive to our customers, to enhance our existing products,
to continue to introduce new products successfully and on a
timely basis, and to develop new or enhance existing tools for
our services offerings.

15



---



##### Table of Contents

A Small Number of Our Customers Account for a Substantial
Portion of Our Revenues, and Most of Our Revenues Come from
Telecommunications Service Providers. The Loss of One or More
Key Customers or Reduced Spending of These Service Providers
Could Significantly Reduce Our Revenues, Profitability and Cash
Flow.

A few large telecommunications service providers account for a
substantial portion of our revenues. These customers include
Verizon and Verizon Wireless, Sprint, BellSouth and China
Unicom. Verizon and Verizon Wireless together accounted for
approximately 28% of our fiscal 2005 revenues, 27% of our fiscal
2004 revenues and 22% of our fiscal 2003 revenues. The
telecommunications industry has recently experienced substantial
consolidation, as evidenced by the mergers of Sprint and Nextel,
Cingular and AT&T Wireless, and SBC and AT&T and the
announced merger of Verizon and MCI. As service providers
increase in size, it is possible that an even greater percentage
of our revenues will be attributable to a smaller number of
large service providers going forward. Further, our customers
are typically not obligated to purchase a certain amount over
any period of time from us and may have the right to reduce,
delay or even cancel previous orders. We, therefore, have
difficulty projecting future revenues from existing customers
with certainty and the estimates we provide are subject to
variability. Although we believe that the size, cost and
complexity of telecommunications networks make sudden changes
unlikely, our customers could and historically have varied their
purchases from period to period, sometimes significantly.
Combined with our reliance on a small number of large customers,
this could have an adverse effect on our revenues, profitability
and cash flow. In addition, our concentration of business in the
telecommunications service provider market makes us extremely
vulnerable to its downturns or slowdowns in spending.

We are working to expand our revenue base to include more
services, government and enterprise revenues as well as to
increase sales in markets outside of the U.S. However,
incumbent and new competitors in those markets could limit or
prevent our ability to expand our revenue base or materially
reduce customer concentration.

The Telecommunications Market Fluctuates and Is Impacted
By Many Factors, Including Decisions By Service Providers
Regarding Their Deployment of Technology and Their Timing of
Purchases, as Well as Demand and Spending for Communications
Services By Businesses and Consumers.

After significant deterioration earlier this decade, the global
telecommunications market stabilized in 2004 and experienced
modest growth in 2005 as reflected in increased capital
expenditures by service providers and growing demand for
telecommunications services. Although we believe the overall
market will continue to grow, the rate of growth could vary
geographically and across different technologies, and is subject
to substantial fluctuations. The specific market segments in
which we participate may not experience the growth of other
segments. In that case, our results of operations may be
adversely affected.

If capital investment by service providers grows at a slower
pace than we anticipate, our revenues and profitability may be
adversely affected. The level of demand by service providers can
change quickly and can vary over short periods of time,
including from month to month. As a result of the uncertainty
and variations in our markets, accurately forecasting revenues,
results and cash flow remains difficult.

In addition, our sales volume and product mix impact our gross
margin. Therefore, if our sales volume does not improve, or we
have an unfavorable product mix, we may not achieve the gross
margin rate we expect, resulting in lower than expected results
of operations. These factors may fluctuate from quarter to
quarter.

We Have Long-Term Sales Agreements with a Number of Our
Large Customers. Some of These Agreements May Prove Unprofitable
As Our Costs and Product Mix Shift Over the Lives of the
Agreements.

We have entered into long-term sales agreements with a number of
our large customers, and we expect we will continue to do so in
the future. Some of these sales agreements require us to sell
products and services at fixed prices over the lives of the
agreements, and some require, or may in the future require, us
to sell products and services that we would otherwise
discontinue, thereby diverting our resources from developing
more profitable or strategically important products. The costs
we incur in fulfilling some of our sales agreements may vary
substantially from our initial cost estimates. Any cost overruns
that we cannot pass on to our customers could adversely affect
our results of operations.

16



---



##### Table of Contents

We Are Exposed to the Credit Risk of Any Customer We
Choose to Finance.

Any financing we provide to customers exposes us to their credit
risk. In particular, as we continue to enter new markets and
work with new customers who may not have established credit and
strong financial resources, we are bearing the risk that these
customers may not pay. This credit exposure would make us
vulnerable to downturns in the economy or in the industry and to
adverse changes in those customers businesses. An adverse
change could force us to record reserves or write-offs in our
financial statements and adversely affect our results of
operations. We might also sell accounts receivables with
collection risk at significant discounts.

We Rely on Two Contractors to Provide Most of the
Components and Products We Design. If Either of Them Fails to
Deliver Quality Components and Products at Reasonable Prices on
a Timely Basis, We May Not Be Able to Fulfill Our Obligations to
Some of Our Customers.

We generally purchase from Celestica most of the wireless
products we design and are transitioning to Solectron the
manufacture of most of the wireline products we design. If
either of them fails to fulfill their obligations to us, or if
we do not properly manage these arrangements, we could fail to
perform some of our obligations to our customers and our
customer relationships could suffer. If so, our customers may
make claims against us for which we do not have sufficient
recourse against our supplier. In addition, by limiting the
number of our contract manufacturers, we have fewer employees
with the expertise needed to manage these third-party
arrangements. We provide rolling forecasts to our contract
manufacturers to manage product supplies, but because of market
fluctuations, accurate forecasting is very difficult and we have
limited ability to adjust volumes and delivery schedules to
satisfy changes customers could require. We also may experience
supply interruptions, cost escalations and competitive
disadvantages if our contract manufacturers fail to develop,
implement or maintain manufacturing methods appropriate for our
products and customers.

Our Global Operations Subject Us to the Social, Political
and Economic Risks of Doing Business in Foreign Countries and
May Cause Our Profitability to Decline Due to Increased
Costs.

We are a global company. Our foreign operations include
integration, manufacturing and test facilities, engineering
centers, sales personnel and customer support functions. For
fiscal 2005 and 2004, we derived approximately 37% and 39%,
respectively, of our revenues from sales outside the U.S.,
including in China, Europe, India and various countries in the
Middle East, such as Iraq and Israel. We are committed to
expanding our business outside the U.S. We are also
dependent on international suppliers for some of our components
and subassemblies and for assembly of some of our products. As a
result, we are subject to the risks inherent in doing business
in foreign countries. These risks include currency exchange
controls and fluctuations in exchange rates; difficulties in
staffing and managing international operations; political or
social unrest or economic instability; uncertain enforcement of
intellectual property rights; the risk of nationalization of
private enterprises; adverse tax consequences, including
imposition of withholding or other taxes on payments by
subsidiaries; the lack of a developed legal system and its
uncertain enforcement; and the risks associated with terrorism
and insurrections. Difficulties in some foreign financial
markets and economies could also inhibit demand from our
customers in the affected countries. Any or all of these factors
could have a material adverse impact on our global business
operations. Although we attempt to manage our exposure to risks
from fluctuations in foreign currency exchange rates through our
regular operating and financing activities and, when deemed
appropriate, through derivative financial instruments, our
attempts may not always be successful. A significant change in
the value of the U.S. dollar against the currency of one or
more countries where we do business may materially adversely
affect our operating results.

Our Pension and Postretirement Benefit Plans Have
Uncertain Funding Requirements. These Plans Are Also
Increasingly Costly and Some of Our Efforts to Fund or Control
Those Costs May Be Ineffective.

Among other compensation and benefit elements, our employees and
retirees in the U.S. participate in one or more of the
following benefit plans:




    management pension plan
    occupational pension plan17



---



##### Table of Contents


    postretirement health care benefit plan for former management
    employees
    postretirement health care benefit plan for former represented
    employeesAs we describe in more detail under the captions
Application of Critical Accounting Estimates 
Pension and postretirement benefits and Liquidity
and Capital Resources  Future capital requirements
and funding sources in Managements Discussion and
Analysis of Financial Condition and Results of Operations
starting on pages F-7 and F-29, respectively, of
Exhibit 13, the performance of the financial markets,
especially the equity markets, and the level of interest rates
impact the funding obligations for our pension plans. This
discussion also describes the variables that influence our
contributions to postretirement health care benefit plans.
Accordingly, the amounts we might contribute to these benefit
plans are subject to considerable uncertainty. You should
carefully review this discussion in Exhibit 13.

We, together with our labor unions, are seeking changes to
Section 420 of the Internal Revenue Code, which would allow
us the flexibility to reduce the cost of retiree health care
benefits in connection with the transfer of excess pension
assets to fund those benefits. Absent satisfactory legislation,
we would have less flexibility under Section 420 in
determining the funding, structure and terms of any retiree
health care benefit plan we make available.

In addition, legislative actions that would impact
U.S. pension plans, if adopted, have been proposed. These
proposals would alter the manner in which liabilities and asset
values are determined for the purpose of calculating required
pension contributions and the timing and manner in which
required contributions to under-funded pension plans would be
made. The proposed changes, if adopted, could significantly
increase the funding requirements for our U.S. pension
plans.

We have also taken some steps and expect to take additional
actions to reduce the overall cost of these benefit plans and
the share of these costs borne by us, consistent with legal
requirements and our collective bargaining obligations. However,
the rate of cost increases may exceed our actions to reduce
these costs. In addition, as described in Note 13 to our
Consolidated Financial Statements in Exhibit 13, our
reduction or elimination of benefits has led to lawsuits against
us. Any other initiatives we undertake to control or reduce
costs may lead to additional claims against us.

Many of Our Current and Planned Products Are Highly
Complex and May Contain Defects or Errors That Are Detected Only
After Deployment in Telecommunications Networks. If That Occurs,
Our Reputation May Be Harmed.

Our products are highly complex, and there is no assurance that
our extensive product development, manufacturing and integration
testing will be adequate to detect all defects, errors, failures
and quality issues that could impact customer satisfaction or
result in claims against us. As a result, we could have to
replace certain components and/or provide remediation in
response to the discovery of defects in products that are
shipped. Most of these occurrences can be rectified without
incident, as has generally been the case historically. However,
the occurrence of any defects, errors, failures or quality
issues could result in cancellation of orders, product returns,
diversion of our resources, legal actions by our customers or
our customers end users and other losses to us or to our
customers or end users. These occurrences could also result in
the loss of or delay in market acceptance of our products and
loss of sales, which would harm our business and adversely
affect our revenues and profitability.

Rapid Changes to Existing Regulations or Technical
Standards or the Implementation of New Ones for Products and
Services Not Previously Regulated Could Be Disruptive,
Time-Consuming and Costly to Us.

We develop many of our products and services based on existing
regulations and technical standards, our interpretation of
unfinished technical standards or the lack of such regulations
and standards. Changes to existing regulations and technical
standards, or the implementation of new regulations and
technical standards relating to products and services not
previously regulated, could adversely affect our development
efforts by increasing compliance cost and causing delay. Demand
for those products and services could also decline.

18



---



##### Table of Contents

We Are Involved in Lawsuits, Which, If Determined against
    Us, Could Require Us to Pay Substantial Damages.We are defendants in various lawsuits, covering such matters as
commercial disputes, claims regarding product discontinuance,
asbestos claims, labor, employment and benefit claims, and
others. For a discussion of some of these legal proceedings, you
should read Note 13 to our Consolidated Financial
Statements in Exhibit 13. We cannot predict the extent to
which any of the pending or future actions will be resolved in
our favor or whether significant monetary judgments will be
rendered against us. Any material losses resulting from these
claims could adversely affect our profitability and cash flow.



If We Fail to Protect Our Intellectual Property Rights,
    Our Business and Prospects May Be Harmed.Intellectual property rights, such as patents, are vital to our
business, and developing new products and technologies that are
unique to us is critical to our success. We have numerous U.S.
and foreign patents and numerous pending patents, but we cannot
predict whether any patents, issued or pending, will provide us
with any competitive advantage or will not be challenged by
third parties. Moreover, our competitors may already have
applied for patents that, once issued, could prevail over our
patent rights or otherwise limit our ability to sell our
products. Our competitors also may attempt to design around our
patents or copy or otherwise obtain and use our proprietary
technology. In addition, patent applications that we have
currently pending may not be granted. If we do not receive the
patents we seek or if other problems arise with our intellectual
property, our competitiveness could be significantly impaired,
which would limit our future revenues and harm our prospects.

We Are Subject to Intellectual Property Litigation and
Infringement Claims, Which Could Cause Us to Incur Significant
Expenses or Prevent Us from Selling Our Products.

From time to time, we receive notices from third parties of
potential infringement and receive claims of potential
infringement when we attempt to license our intellectual
property to others. Intellectual property litigation can be
costly and time-consuming and can divert the attention of
management and key personnel from other business issues. The
complexity of the technology involved and the uncertainty of
intellectual property litigation increase these risks. A
successful claim by a third party of patent or other
intellectual property infringement by us could compel us to
enter into costly royalty or license agreements or force us to
pay significant damages and could even require us to stop
selling certain products. Further, if one of our important
patents or other intellectual property right is invalidated, we
may suffer losses of licensing revenues and be prevented from
blocking others, including competitors, from using the related
technology.

We Are Subject to Environmental, Health and Safety Laws
that Restrict Our Operations.

Our operations are subject to a wide range of environmental,
health and safety laws, including laws relating to the use,
disposal and clean-up of, and human exposure to, hazardous
substances. In the United States, these laws often require
parties to fund remedial action regardless of fault. Although we
believe our reserves are adequate to cover our environmental
liabilities, factors such as the discovery of additional
contaminants, the extent of required remediation and the
imposition of additional cleanup obligations could cause our
capital expenditures and other expenses relating to remediation
activities to exceed the amount reflected in our environmental
reserve and adversely affect our results of operations and cash
flows. Compliance with existing or future environmental, health
and safety laws could subject us to future liabilities, cause
the suspension of production, restrict our ability to utilize
facilities or require us to acquire costly pollution control
equipment or incur other significant expenses.

Employee Relations

As of September 30, 2005, we had approximately 30,500
employees, of whom approximately 18,500, or 60%, were located in
the United States. Unions, primarily the Communications Workers
of America, represent approximately 3,000, or 10%, of our
employees, or approximately 16% of our U.S. employees.

19



---



##### Table of Contents

Executive Officers of the Registrant

The following information about our executive officers is
included herein in accordance with Part III, Item 10
and is as of November 30, 2005.

|                              |  |     |    |  |       |                                                          |         |  |       | 
|----------------------------- |  | --- | -- |  | ----- | -------------------------------------------------------- | ------- |  | ----- | 
|                              |  |     |    |  |       | Date Became                                              |        
|                              |  |     |    |  |       | Executive                                                |        
|Name                          |  | Age |    |  | Title |                                                          | Officer | 
|Patricia F. Russo             |  |     | 53 |  |       | Chairman and Chief Executive Officer                     |         |  | 01/02 | 
|James K. Brewington           |  |     | 62 |  |       | President, Developing Markets                            |         |  | 10/02 | 
|William R.
    Carapezzi, Jr. |  |     | 48 |  |       | Senior Vice President, General
    Counsel and Secretary |         |  | 06/04 | 
|Cynthia Christy-Langenfeld    |  |     | 39 |  |       | President, Network Solutions Group                       |         |  | 03/04 | 
|Frank A. DAmelio             |  |     | 47 |  |       | Executive Vice President and Chief
    Financial Officer |         |  | 05/01 | 
|Janet G. Davidson             |  |     | 49 |  |       | Chief Strategy Officer                                   |         |  | 10/02 | 
|Jeong Kim                     |  |     | 45 |  |       | President, Bell Laboratories                             |         |  | 04/05 | 
|John A. Kritzmacher           |  |     | 45 |  |       | Senior Vice President and Controller                     |         |  | 08/01 | 
|Jose A. Mejia                 |  |     | 45 |  |       | President, Supply Chain Networks                         |         |  | 10/03 | 
|John A. Meyer                 |  |     | 49 |  |       | President, Lucent Worldwide Services                     |         |  | 10/03 | 
|Robert Warstler               |  |     | 63 |  |       | President, Global Sales                                  |         |  | 10/03 | 





Environmental Matters




20



---



##### Table of Contents

The future impact of environmental matters, including potential
liabilities, is often difficult to estimate. We record an
environmental reserve when it is probable that a liability has
been incurred and the amount of the liability is reasonably
estimable. This practice is followed whether the claims are
asserted or unasserted. Management expects that the amounts
reserved will be paid out over the periods of remediation for
the applicable sites, which typically range from five to
30 years.

For additional information about our environmental matters, see
Note 13 to our Consolidated Financial Statements contained
in Exhibit 13 to this report.

Separation Agreements

In connection with our separation from AT&T in 1996, we,
AT&T and NCR Corp. entered into a Separation and
Distribution Agreement and related ancillary agreements,
including an employee benefits agreement, technology-related
agreements, a tax-sharing agreement and other tax-related
agreements. We entered into similar agreements with Avaya and
Agere when we spun them off.

These agreements provide that we and our former affiliates are
separately responsible for all liabilities, including contingent
liabilities, related to our and their respective businesses and
operations. In addition, these agreements provide for the
sharing of contingent liabilities that are neither primarily our
contingent liabilities nor contingent liabilities associated
with the businesses of our former affiliates. We also share
liability for specifically identified liabilities, including
liabilities relating to terminated, divested or discontinued
businesses or operations, and, in the agreements with AT&T
and Avaya, specified contingent liabilities and excess
liabilities.







Item 2.
    PropertiesAs of September 30, 2005, we operated in 149 facilities in
the United States totaling 15.5 million square feet, of
which 8.3 million was owned and 7.2 million was
leased. In addition, we operated in 144 facilities in 47 other
countries totaling 4.6 million square feet, of which
1.4 million was owned and 3.2 million was leased. Our
properties include systems integration/manufacturing sites,
warehouse sites, offices sites (administration, sales, field
service), and research and development sites. Included above are
1.3 million square feet that have been vacated under our
restructuring actions. Most of the properties are used jointly
by our reporting segments. We believe our facilities are
suitable and adequate to meet our current needs.







Item 3.
    Legal ProceedingsWe are subject to legal proceedings, lawsuits and other claims,
including proceedings by government authorities. In addition, we
may be subject to liabilities to some of our former affiliates
under separation agreements with them (see Item 1.
Business  Separation Agreements). Legal
proceedings are subject to uncertainties, and the outcomes are
difficult to predict. Consequently, we are unable to estimate
the ultimate aggregate amount of monetary liability or financial
impact with respect to these matters as of September 30,
2005. We believe that our current cases will not have a material
financial impact on us after final disposition. However, because
of the uncertainties of legal proceedings, one or more of these
proceedings could ultimately result in material monetary
payments by us.

Please see Note 13 to our Consolidated Financial Statements
contained in Exhibit 13 to this report for additional
information about legal proceedings involving us.

Litigation and Lawsuits

Litigation, lawsuits and similar claims currently involving us
include the following types of matters:




    Commercial disputes including breach of contract, product
    performance disputes and other claims.
    Intellectual property actions, usually involving patent
    infringement claims.
    Employment, including retiree benefit, matters.
    Environmental, health and safety claims, including
    asbestos-related claims.21



---



##### Table of Contents

In the normal course of business, we are involved in commercial
disputes with customers, suppliers, subcontractors and others.
These matters generally involve claims for monetary damages for
breach of contract or breach of warranty or similar claims.
While many of these disputes are settled amicably without
litigation, some will result in lawsuits. The downturn in the
telecommunications market early this decade and the insolvency
or failure of numerous service providers have led to more claims
and disputes and to an increase in the number that results in
litigation.

We are defendants in various cases in which third parties have
claimed we are infringing their patents, including certain cases
where infringement claims have been made against our customers
in connection with products we have provided to them. We also
occasionally institute actions against third parties whom we
believe are infringing our intellectual property rights, and
these actions sometimes lead to counterclaims by the opposing
parties.

We are subject to various employment-related claims regarding
employee dismissals, benefits, compensation and other matters.
As a result of our restructuring actions and plans for the
future, we have reduced our workforce significantly and may make
further reductions in the future. Although we have not
experienced a significant increase in the number of
employment-related claims as a result of these workforce
reductions, workforce reductions can precipitate additional
claims against us. We have taken and may continue to take steps
to reduce the cost of providing postretirement health care
benefits. These actions may increase claims made against us, and
lawsuits have been filed against us in connection with the
elimination of the death benefit in our U.S. Management
Pension Plan and reductions in retiree health care benefits. In
addition, the Equal Employment Opportunity Commission has
initiated a suit against us regarding certain policies used by
our predecessors prior to 1980.

We are a defendant in various lawsuits involving alleged
exposure to asbestos. These cases involve exposure to asbestos
in premises owned or operated by us or by the predecessors of
our business, such as AT&T or Western Electric, or in
products manufactured or sold by us or our predecessors.
Historically, we have not paid any material amounts related to
asbestos claims. We have experienced an increase in the number
of asbestos claims asserted against us, and these claims are on
the rise generally in the United States against owners or
operators of premises or companies that manufactured or sold
products allegedly containing asbestos. Despite this trend, we
currently do not expect these cases to have a significant impact
on us in the future, although no assurance can be given that
this will be the case.

We have resolved our primary securities and related cases.

Government Investigations

On November 21, 2000, we announced that we had identified
an issue affecting our revenues in the fourth quarter of fiscal
2000. We informed the SEC and initiated a review by our outside
counsel and independent accountants. A final judgment and
consent decree with the SEC was entered for this matter in May
2004. Under the terms of the consent decree, we paid a
$25 million civil penalty in the third quarter of fiscal
2004 but were not required to make any financial restatements.
Without admitting or denying any wrongdoing, we consented to the
settlement, which enjoins us from future violations of specific
provisions of the federal securities laws.

In August 2002, we reported that the SEC, which had been
investigating facts related to certain revenue recognition
issues that we had brought to its attention, made a referral to
the United States Attorneys Office for the District of New
Jersey for further investigation. Lucent was not a target of
this investigation. In early September 2005, Lucent confirmed
that no charges would be filed against it in connection with the
investigation.

In August 2003, the U.S. Department of Justice and the SEC
informed us that they had each commenced an investigation into
possible violations of the Foreign Corrupt Practices Act with
respect to our operations in Saudi Arabia. These investigations
follow allegations made by National Group for Communications and
Computers Ltd. in an action filed against us on August 8,
2003. In April 2004, we reported to the DOJ and the SEC that an
internal FCPA compliance audit and an outside counsel
investigation found incidents and internal control deficiencies
in our operations in China that potentially involve FCPA
violations. We are cooperating with both agencies.

22



---



##### Table of Contents

As disclosed in an 8-K filing on November 8, 2004, our
former Chairman and Chief Executive Officer, Richard McGinn, the
former head of our Saudi Arabia operations, John Heindel, and a
third former employee received Wells notices from
the staff of the SEC. In early May 2005, the SEC Enforcement
Staff notified representatives of these individuals that the
Staff would not be recommending enforcement action against these
individuals. We have not received a Wells notice at this time,
but the investigation is continuing with respect to both China
and Saudi Arabia.

As disclosed in our quarterly report on Form 10-Q filed on
August 4, 2005, in May 2005, we received subpoenas on two
different matters, requesting specific documents and records.
One of the subpoenas relates to a U.S. Department of
Justice investigation of potential antitrust and other
violations by various participants in connection with the
federal E-Rate program. The subpoena requires us to produce
documents before a grand jury of the U.S. District Court in
Georgia. The second subpoena was from the Office of Inspector
General, U.S. General Services Administration and relates
to a federal investigation into certain sales to the federal
government of telecommunications equipment and related
maintenance services.







Item 4.
    Submission of Matters to a Vote of Security HoldersDuring the fourth quarter of fiscal 2005, no matters were
submitted to a vote of our security holders.

23



---



##### Table of Contents

PART II





Item 5. Market for Registrants Common Equity,
Related Stockholder Matters and Issuer Purchases of Equity
Securities



(a)
    Market Price, Holders and Dividend InformationOur common stock is traded on the New York Stock Exchange
(NYSE) under the symbol LU. The following table
presents the high and low sales prices of our common stock as
reported on the NYSE:

|                                     |  |      |      |  |     |   |      | 
|------------------------------------ |  | ---- | ---- |  | --- | - | ---- | 
|                                     |  | High |      |  | Low |  
|                                     |  |      |      |  |     |  
|YEAR ENDED SEPTEMBER 30, 2005        |  |      |      |  |     |   |      | 
|Quarter ended December 31, 2004      |  | $    | 4.16 |  |     | $ | 3.11 | 
|Quarter ended March 31, 2005         |  |      | 3.86 |  |     |   | 2.70 | 
|Quarter ended June 30, 2005          |  |      | 3.17 |  |     |   | 2.35 | 
|Quarter ended September 30,
    2005 |  |      | 3.30 |  |     |   | 2.81 | 
|YEAR ENDED SEPTEMBER 30, 2004        |  |      |      |  |     |   |      | 
|Quarter ended December 31, 2003      |  | $    | 3.44 |  |     | $ | 2.08 | 
|Quarter ended March 31, 2004         |  |      | 4.91 |  |     |   | 2.87 | 
|Quarter ended June 30, 2004          |  |      | 4.52 |  |     |   | 2.99 | 
|Quarter ended September 30,
    2004 |  |      | 3.80 |  |     |   | 2.70 | 
















Item 6. Selected Financial Data









|        |                                                                                          
|------- | -----------------------------------------------------------------------------------------
|Item 7. | Managements Discussion and Analysis of Financial
    Condition and Results of Operations








|         |                                                           
|-------- | ----------------------------------------------------------
|Item 7A. | Quantitative and Qualitative Disclosures About Market Risk



24



---



##### Table of Contents

Item 8.
    Financial Statements and Supplementary DataThe information required by this item is included in pages F-36
to F-80 of our annual report to shareowners for the year ended
September 30, 2005. These pages of the annual report to
shareowners are included in Exhibit 13 to this report.







Item 9.
    Changes in and Disagreements with Accountants on Accounting
    and Financial DisclosureNone.







Item 9A.
    Controls and Procedures

Conclusion Regarding the Effectiveness of Disclosure Controls
    and ProceduresOur management, with the participation of our Chief Executive
Officer and Chief Financial Officer, evaluated the effectiveness
of our disclosure controls and procedures as of
September 30, 2005. The term disclosure controls and
procedures, as defined in Rules 13a-15(e) and
15d-15(e) under the Exchange Act, means controls and other
procedures of a company that are designed to ensure that
information required to be disclosed by a company in the reports
that it files or submits under the Exchange Act is recorded,
processed, summarized and reported, within the time periods
specified in the SECs rules and forms. Disclosure controls
and procedures include, without limitation, controls and
procedures designed to ensure that information required to be
disclosed by a company in the reports that it files or submits
under the Exchange Act is accumulated and communicated to the
companys management, including its principal executive and
principal financial officers, as appropriate to allow timely
decisions regarding required disclosure. Management recognizes
that any controls and procedures, no matter how well designed
and operated, can provide only reasonable assurance of achieving
their objectives and management necessarily applies its judgment
in evaluating the cost-benefit relationship of possible controls
and procedures. Based on the evaluation of our disclosure
controls and procedures as of September 30, 2005, our Chief
Executive Officer and Chief Financial Officer concluded that, as
of such date, our disclosure controls and procedures were
effective at the reasonable assurance level.



Managements Report on Internal Control over Financial
    ReportingManagements report on our internal control over financial
reporting (as defined in Rules 13a-15(f) and 15d-15(f)
under the Exchange Act) and the independent registered public
accounting firms related audit report are included in
Item 8 of this Annual Report on Form 10-K and are
incorporated herein by reference.



Changes in Internal Control over Financial ReportingNo change in our internal control over financial reporting
occurred during the fiscal quarter ended September 30, 2005
that has materially affected, or is reasonably likely to
materially affect, our internal control over financial reporting.





Item 9B. Other Information

None.

25



---



##### Table of Contents

PART III





Item 10. Directors and Executive Officers of the
Registrant

Information required by this item for executive officers is set
forth under the heading Executive Officers of the
Registrant in Part I, Item 1, of this report.
The other information required by Item 10 is included in
our definitive proxy statement for our 2006 annual meeting of
shareowners to be held on February 15, 2006, and is
incorporated herein by reference.

We have adopted a code of ethics that applies to our Chief
Executive Officer and all financial officers and executives,
including our Chief Financial Officer and Controller. This code
of ethics supplements our Business Guideposts: A Personal
Commitment, which is a code of business conduct and ethics
applicable to all of our directors and employees, and is posted
on our Website. The Internet address for our Website is
www.lucent.com.

We intend to satisfy any disclosure requirement under
Item 5.05 of Form 8-K regarding an amendment to, or
waiver from, a provision of this code of ethics by posting such
information on our Website, at the address specified above.







Item 11.
    Executive CompensationThe information required by this item is included in our
definitive proxy statement for our 2006 annual meeting of
shareowners to be held on February 15, 2006, and is
incorporated herein by reference.





Item 12. Security Ownership of Certain Beneficial
Owners and Management and Related Stockholder Matters

The following table provides information as of
September 30, 2005 with respect to shares of our common
stock that may be issued under our existing equity compensation
plans, including the 2001 Employee Stock Purchase Plan (the
ESPP), the Lucent Technologies Inc. 2003 Long-Term
Incentive Program (the 2003 Plan) and the 2004
Equity Compensation Plan for Non-Employee Directors.

The table does not include information with respect to shares
subject to outstanding options granted under equity compensation
plans under which the right to grant options has expired prior
to September 30, 2005 and equity compensation plans assumed
by the Company in connection with mergers and acquisitions of
the companies that originally granted those options. Footnotes
(4) and (5) to the table set forth the total number of
shares of our common stock issuable upon the exercise of options
under the expired plans and assumed options, respectively, as of
September 30, 2005, and the weighted average exercise price
of those options. No additional options may be granted under
those expired and assumed plans.

|                                                              |  |                  |            |     |                   |  |                         |                             |  |  |             |    
|------------------------------------------------------------- |  | ---------------- | ---------- | --- | ----------------- |  | ----------------------- | --------------------------- |  |  | ----------- | ---
|                                                              |  | A                |            |     | B                 |  |                         | C                           | 
|                                                              |  | Number of        |            |     |                   |  | Number of securities    |                            
|                                                              |  | securities to be |            |     |                   |  | remaining available for |                            
|                                                              |  | issued upon      |            |     | Weighted average  |  |                         | future issuance under       | 
|                                                              |  | exercise of      |            |     | exercise price of |  |                         | equity compensation         | 
|                                                              |  | outstanding      |            |     | outstanding       |  |                         | plans (excluding securities | 
|                                                              |  | options          |            |     | options           |  |                         | reflected in column A)      | 
|                                                              |  |                  |            |     |                   |  |                         |                             | 
|Plan category:                                                |  |                  |            |     |                   |  |                         |                             |  |  |             |    
|Equity compensation plans
    approved
    by shareowners (1) |  |                  | 62,494,649 | (2) |                   |  | $3.72                   | (2)                         |  |  | 302,789,560 | (3)
|Equity compensation plans not
    approved
    by shareowners |  |                  | -          |     |                   |  | -                       |                             |  |  | -           |    
|                                                              |  |                  |            |     |                   |  |                         |                             | 
|                                                              |  |                  | 62,494,649 |     |                   |  | $3.72                   |                             |  |  | 302,789,560 |    
|                                                              |  |                  |            |     |                   |  |                         |                             | 



|    |                                                                                                          
|--- | ---------------------------------------------------------------------------------------------------------
|(1) | Consists of the ESPP, the 2003 Plan and the 2004 Equity
    Compensation Plan for Non-Employee Directors.

26



---



##### Table of Contents

(2)
    Excludes purchase rights accruing under the ESPP, which has a
    shareowner-approved reserve of 250,000,000 shares. Under
    the ESPP, each eligible employee may purchase up to
    4,000 shares of our common stock at semi-annual intervals.
    The purchase price per share was equal to 85% of the lower of
    the fair market value of our common stock on either the first or
    last trading day of a purchase period until the purchase period
    that began November 1, 2005, when the purchase price per
    share was made equal to 95% of the fair market value of our
    common stock on the purchase date.(3)
    Includes shares available for future issuance under the ESPP. As
    of September 30, 2005, an aggregate of
    193,022,490 shares of our common stock were available for
    issuance under the ESPP.(4)
    The table does not include information for equity compensation
    plans that have expired. The Founders Grant Stock Option Plan
    expired on December 31, 1996. As of September 30,
    2005, a total of 19,936,535 shares of our common stock were
    issuable upon the exercise of outstanding options granted under
    the expired plan. The 1998 Global Stock Option Plan expired on
    April 1, 2000. As of September 30, 2005, a total of
    7,748,817 shares of our common stock were issuable upon the
    exercise of outstanding options granted under the expired plan.
    The 1996 Long Term Incentive Program expired on
    February 28, 2004. As of September 30, 2005, a total
    of 80,775,051 shares of our common stock were issuable upon
    the exercise of outstanding options granted under the expired
    plan. The 1997 Long-Term Incentive Plan expired on
    December 31, 2003. As of September 30, 2005, a total
    of 238,057,161 shares of our common stock were issuable
    upon the exercise of outstanding options granted under the
    expired plan. The 1999 Stock Compensation Plan for Non-Employee
    Directors expired on February 1, 2004. As of
    September 30, 2005, a total of 363,072 shares of our
    common stock were issuable upon the exercise of outstanding
    options granted under the expired plan. The weighted average
    exercise price of the outstanding options granted under these
    five plans is $11.65 per share. No additional options may
    be granted under these expired plans.(5)
    The table does not include information for equity compensation
    plans assumed by Lucent in connection with our separation from
    AT&T and subsequent mergers and acquisitions of the
    companies which originally established those plans. As of
    September 30, 2005, a total of 8,945,139 shares of our
    common stock were issuable upon exercise of outstanding options
    granted under those assumed plans. The weighted average exercise
    price of those outstanding options is $13.18 per share. No
    additional options may be granted under those assumed plans.The other information required by Item 12 is included in
our definitive proxy statement for our 2006 annual meeting of
shareowners to be held on February 15, 2006, and is
incorporated herein by reference.







Item 13.
    Certain Relationships and Related TransactionsThe information required by this item is included in our
definitive proxy statement for our 2006 annual meeting of
shareowners to be held on February 15, 2006, and is
incorporated herein by reference.







Item 14.
    Principal Accounting Fees and ServicesThe information required by this item is included in our
definitive proxy statement for our 2006 annual meeting of
shareowners to be held on February 15, 2006, and is
incorporated herein by reference.

27



---



##### Table of Contents

PART IV







Item 15.
    Exhibits and Financial Statement Schedule(a) The following documents are filed as part of this
report:

|    |  |                                                  |  |                                                                         |   |       |   | 
|--- |  | ------------------------------------------------ |  | ----------------------------------------------------------------------- | - | ----- | - | 
|    |  |                                                  |  |                                                                         |   | Pages |  
|    |  |                                                  |  |                                                                         |   |       |  
|(1) |  | Consolidated Financial Statements:               |  |                                                                         |   |      
|    |  | (i)                                              |  | Consolidated Statements of
    Operations                               |   |       | * | 
|    |  | (ii)                                             |  | Consolidated Balance Sheets                                             |   |       | * | 
|    |  | (iii)                                            |  | Consolidated Statements of Changes
    in Shareowners Equity (Deficit) |   |       | * | 
|    |  | (iv)                                             |  | Consolidated Statements of Cash
    Flows                               |   |       | * | 
|    |  | (v)                                              |  | Notes to Consolidated Financial
    Statements                          |   |       | * | 
|(2) |  | Five-Year Summary of Selected
    Financial Data |  |                                                                         | * |      



|  |                                                                                                                                                                                                            
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|* | Incorporated by reference to the appropriate portions in pages
    F-38 through F-80 of our annual report to shareowners for the
    fiscal year ended September 30, 2005 (see Part II and
    Exhibit 13).











28



---



##### Table of Contents

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned,
hereunto duly authorized.



LUCENT TECHNOLOGIES INC.

By:
    /s/ JOHN A. KRITZMACHERJohn A. KritzmacherSenior Vice President and Controller(Principal Accounting Officer)Date: December 14, 2005Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the
date indicated.

/s/ PATRICIA F. RUSSO



PRINCIPAL EXECUTIVE OFFICER

Patricia F. Russo

Chairman
and Chief Executive Officer

Date: December 14, 2005

/s/ FRANK A. DAMELIO



PRINCIPAL FINANCIAL OFFICER

Frank A. DAmelio

Executive
Vice President and Chief Financial Officer

Date: December 14, 2005

/s/ JOHN A. KRITZMACHER



PRINCIPAL ACCOUNTING OFFICER

John A. Kritzmacher

Senior
Vice President and Controller

Date: December 14, 2005

DIRECTORS

Linnet Deily

Robert E. Denham

Daniel S. Goldin

Edward E. Hagenlocker

Carla A. Hills

Karl J. Krapek

Richard C. Levin

Patricia F. Russo

Henry B. Schacht

Franklin A. Thomas

Ronald A. Williams

John A. Young

By:
    /s/ JOHN A. KRITZMACHERAttorney-in-FactDate: December 14, 200529



---



##### Table of Contents

EXHIBIT INDEX

The following documents are filed as exhibits to this report on
Form 10-K or incorporated by reference herein. Any document
incorporated by reference is identified by a parenthetical
reference to the SEC filing that included such document.

|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                          
|------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |  |                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Number  |  | Description                                                                                                                                                                                                                                                                                                                                                                                                                              
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                          
|3(i) 1  |  | Certificate of Incorporation of the
    registrant, as amended, effective February 16, 2000
    (Exhibit 3.1 to Registration Statement on Form S-4,
    No. 333-31400).                                                                                                                                                                                                                                                                  
|       
|3(i) 2  |  | Certificate of Amendment of
    Restated Certificate of Incorporation of the registrant dated
    February 26, 2004 (Exhibit 3(i) to Quarterly Report on
    Form 10-Q for the quarter ended March 31, 2004).                                                                                                                                                                                                                            
|       
|3(ii)   |  | By-Laws of the registrant, as
    amended through February 18, 2004 (Exhibit 3(ii) to
    Quarterly Report on Form 10-Q for the quarter ended
    March 31, 2004).                                                                                                                                                                                                                                                                       
|       
|4(ii) 1 |  | Form of the registrants
    Common Stock Certificate (Exhibit 4(iv) to Quarterly Report
    on Form 10-Q for the quarter ended December 31, 2001).                                                                                                                                                                                                                                                                                      
|       
|4(ii) 2 |  | Indenture, dated as of
    April 1, 1996, between Lucent Technologies Inc. and The
    Bank of New York, as trustee (Exhibit 4A to Registration
    Statement on Form S-3, No. 333-01223).                                                                                                                                                                                                                                               
|       
|4(ii) 3 |  | First Supplemental Indenture, dated
    as of April 17, 2000, to Indenture dated April 1, 1996
    (Exhibit 4 to the Current Report on Form 8-K filed
    May 5, 2000).                                                                                                                                                                                                                                                                  
|       
|4(ii) 4 |  | Amended and Restated Trust
    Agreement, dated as of March 19, 2002, among the
    registrant, as depositor, The Bank of New York, as property
    trustee, The Bank of New York (Delaware), as Delaware trustee,
    and the individuals named therein, as administrative trustees,
    relating to Lucent Technologies Capital Trust I
    (Exhibit 4(v) 1 to Quarterly Report on Form 10-Q for
    the quarter ended March 31, 2002).
|       
|4(ii) 5 |  | Form of certificate for preferred
    securities of Lucent Technologies Capital Trust I,
    designated as 7.75% Cumulative Convertible Trust Preferred
    Securities (liquidation preference $1,000 per preferred
    security) (Exhibit B to Exhibit 4(v) 1 to Quarterly
    Report on Form 10-Q for the quarter ended March 31,
    2002).                                                                                           
|       
|4(ii) 6 |  | Indenture, dated as of
    March 19, 2002, between the registrant and The Bank of New
    York, as indenture trustee (Exhibit 4(v) 3 to Quarterly
    Report on Form 10-Q for the quarter ended March 31,
    2002).                                                                                                                                                                                                                     
|       
|4(ii) 7 |  | Form of the registrants
    7.75% convertible subordinated debentures due 2017
    (Exhibit A to Exhibit 4(v) 3 to Quarterly Report on
    Form 10-Q for the quarter ended March 31, 2002).                                                                                                                                                                                                                                             
|       
|4(ii) 8 |  | Guarantee Agreement, dated as of
    March 19, 2002, between the registrant, as guarantor, and
    The Bank of New York, as guarantee trustee (Exhibit 4(v) 5
    to Quarterly Report on Form 10-Q for the quarter ended
    March 31, 2002).                                                                                                                                                                                            

30



---



##### Table of Contents



|         |  |                                                                                                                                                                                                                                                                                                                                                                                             
|-------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        
|4(ii) 9  |  | Indenture, dated as of June 4,
    2003, between Lucent Technologies Inc. and The Bank of New York,
    as trustee (Exhibit 4.1 to Current Report on Form 8-K
    filed June 25, 2003).                                                                                                                                                                                                     
|        
|4(ii) 10 |  | First Supplemental Indenture, dated
    as of June 4, 2003, between Lucent Technologies Inc. and
    The Bank of New York, as trustee (Exhibit 4.2 to the
    Current Report on Form 8-K filed June 25, 2003).                                                                                                                                                                              
|        
|4(ii) 11 |  | Indenture dated as of
    November 24, 2003, between Lucent Technologies Inc. and the
    Bank of New York as trustee (Exhibit 4(ii)11 to Annual
    Report on Form 10-K for the year ended September 30,
    2003).                                                                                                                                                                        
|        
|4(ii) 12 |  | Form of registrants
    8% convertible subordinated debenture due 2031
    (Exhibit A to Exhibit 4(ii) 11 to Annual Report on
    Form 10-K for the year ended September 30, 2003).                                                                                                                                                                                                        
|        
|4(ii) 13 |  | Warrant Agreement (including Form
    of Warrant Certificate), dated as of December 10, 2004,
    between Lucent Technologies Inc. and The Bank of New York, as
    warrant agent (Exhibit 4.1 to the Current Report on
    Form 8-K filed on December 10, 2004).                                                                                                                           
|        
|4(ii) 14 |  | Stipulation and Agreement of
    Settlement, dated September 22, 2003, in settlement of
    litigation in the U.S. District Court for the District of
    New Jersey entitled In re Lucent Technologies Inc. Securities
    Litigation (Exhibit 4.8 to Registration Statement on
    Form S-3 No. 333-120984).                                                                              
|        
|4(iii)   |  | Other instruments in addition to
    exhibits under 4(ii) that define the rights of holders of
    long-term debt of the registrant and all of its consolidated
    subsidiaries are not filed herewith pursuant to
    Regulation S-K, Item 601(b)(4)(iii)(A). Pursuant to
    this regulation, the registrant agrees to furnish a copy of any
    such instrument to the SEC upon request.
|        
|10(i) 1  |  | Tax Sharing Agreement, by and among
    Lucent Technologies Inc., AT&T Corp. and NCR Corporation,
    dated as of February 1, 1996, and amended and restated as
    of March 29, 1996 (Exhibit 10.6 to Registration
    Statement on Form S-1 No. 333-00703).                                                                                                                               
|        
|10(i) 2  |  | Rights Agreement, between Lucent
    Technologies Inc. and The Bank of New York (successor to First
    Chicago Trust Company of New York), as rights agent, dated as of
    April 4, 1996 (Exhibit 4.2 to Registration Statement
    on Form S-1 No. 333-00703).                                                                                                                           
|        
|10(i) 3  |  | Amendment to Rights Agreement,
    between Lucent Technologies Inc. and The Bank of New York
    (successor to First Chicago Trust Company of New York), dated as
    of February 18, 1998 (Exhibit 10(i) 5 to the Annual
    Report on Form 10-K for the year ended September 30,
    1998).                                                                                               
|        
|10(i) 4  |  | Amended and Restated Letter of
    Credit Issuance and Reimbursement Agreement, dated as of
    October 1, 2004, among Lucent Technologies Inc., several
    banks and other parties thereto and JPMorgan Chase Bank, N.A.,
    as administrative agent (Exhibit 99.1 to the Current Report
    on Form 8-K filed on October 7, 2004).                                                      
|        
|10(i) 5  |  | Amended and Restated External
    Sharing Debt Agreement, dated as of October 1, 2004, among
    Lucent Technologies Inc., several banks and other parties
    thereto and JPMorgan Chase Bank, N.A., as administrative agent
    (Exhibit 99.2 to the Current Report on Form 8-K filed
    on October 7, 2004).                                                                            

31



---



##### Table of Contents



|             |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|------------ |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10(i) 6      |  | First Amendment, dated as of
    April 8, 2005, to (i) the Amended and Restated Letter
    of Credit Issuance and Reimbursement Agreement, dated as of
    October 1, 2004, among Lucent Technologies Inc., the
    several banks and other financial institutions or entities from
    time to time parties thereto and JPMorgan Chase Bank, N.A., as
    Administrative Agent and (ii) the Amended and Restated
    External Sharing Debt Agreement, dated as of October 1,
    2004, among Lucent Technologies Inc., the several banks and
    other financial institutions or entities from time to time
    parties thereto and JPMorgan Chase Bank, N.A., as Administrative
    Agent (Exhibit 10.1 to Quarterly Report on Form 10-Q
    for the quarter ended March 31, 2005).
|            
|10(i) 7      |  | Amended and Restated Guarantee and
    Collateral Agreement, dated as of October 1, 2004, made by
    Lucent Technologies Inc. and certain of its subsidiaries in
    favor of JPMorgan Chase Bank, N.A., as collateral agent
    (Exhibit 99.3 to the Current Report on Form 8-K filed
    on October 7, 2004).                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|            
|10(i) 8      |  | Amended and Restated Collateral
    Sharing Agreement, dated as of October 1, 2004, made by
    Lucent Technologies Inc. and certain of its subsidiaries in
    favor of JPMorgan Chase Bank, N.A., as collateral agent
    (Exhibit 99.4 to the Current Report on Form 8-K filed
    on October 7, 2004).                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|            
|10(ii)(B) 1  |  | Patent License Agreement, among
    AT&T Corp., NCR Corporation and Lucent Technologies Inc.,
    effective as of March 29, 1996, (Exhibit 10.7 to
    Registration Statement on Form S-1 No. 333-00703).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|            
|10(ii)(B) 2  |  | Amended and Restated Technology
    License Agreement, among AT&T Corp., NCR Corporation and
    Lucent Technologies Inc., effective as of March 29, 1996,
    (Exhibit 10.8 to Registration Statement on Form S-1
    No. 333-00703).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|            
|10(ii)(B) 3  |  | Electronics Manufacturing Services
    Agreement, No. HO32050265, between Lucent Technologies Inc. and
    Solectron Corporation, entered into as of July 21, 2005.*                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|            
|10(ii)(B) 4  |  | External Manufacturing Services
    Agreement, No. WR71050115, between Lucent Technologies Inc. and
    Celestica Corporation, entered into as of September 30,
    2005, and effective as of April 1, 2005.*                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|10(ii)(B) 5  |  | Transition Agreement between
    Celestica Corporation and Lucent Technologies Inc., dated as of
    September 30, 2005.*                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|            
|10(iii)(A) 1 |  | Lucent Technologies Inc. Short Term
    Incentive Program (Exhibit 10(iii)(A) 1 to the Annual
    Report on Form 10-K for the year ended September 30,
    2004).**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|            
|10(iii)(A) 2 |  | Lucent Technologies Inc. 2003 Long
    Term Incentive Plan (Exhibit 10.2 to Current Report on
    Form 8-K filed April 11, 2003).**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|            
|10(iii)(A) 3 |  | First Amendment to the Lucent
    Technologies Inc. 2003 Long Term Incentive Plan
    (Exhibit 10(iii)(A) 3 to the Annual Report on
    Form 10-K for the year ended September 30, 2004).**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|            
|10(iii)(A) 4 |  | Form of Lucent Technologies Inc.
    2003 Long Term Incentive Program Stock Option Agreement.**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|            
|10(iii)(A) 5 |  | Form of Lucent Technologies Inc.
    2003 Long Term Incentive Program Nonstatutory Stock Option
    Agreement.**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

32



---



##### Table of Contents



|                |  |                                                                                                                                                                                                                        
|--------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10(iii)(A) 6(a) |  | Form of Lucent Technologies Inc.
    2003 Long Term Incentive Program Restricted Stock Unit Award
    Agreement for the 2005 Portion of the 2004-2006 Performance
    Cycle.**                                         
|               
|10(iii)(A) 6(b) |  | Form of Lucent Technologies Inc.
    2003 Long Term Incentive Program Restricted Stock Unit Award
    Agreement (for Executive Officers).**                                                                            
|               
|10(iii)A 6(c)   |  | Form of Lucent Technologies Inc.
    2003 Long Term Incentive Program Restricted Stock Unit Award
    Agreement.**                                                                                                     
|               
|10(iii)(A) 7    |  | Form of Lucent Technologies Inc.
    2003 Long Term Incentive Program Performance Award Agreement.**                                                                                                                   
|               
|10(iii)(A) 8    |  | Form of Lucent Technologies Inc.
    2003 Long Term Incentive Program Performance Award Agreement
    (for Executive Officers).**                                                                                      
|               
|10(iii)(A) 9    |  | Lucent Technologies Inc. 2004
    Equity Compensation Plan for Non-Employee Directors
    (Exhibit 10(iii) 1 to the Quarterly Report on
    Form 10-Q for the quarter ended March 31, 2004).**                         
|               
|10(iii)(A) 10   |  | First Amendment to the Lucent
    Technologies Inc. 2004 Equity Compensation Plan for Non-Employee
    Directors (Exhibit 10(iii)(A) 6 to the Annual Report on
    Form 10-K for the year ended September 30, 2004).** 
|               
|10(iii)(A) 11   |  | Lucent Technologies Inc. Deferred
    Compensation Plan (Exhibit 10(iii)(A) 7 to the Annual
    Report on Form 10-K for the year ended September 30,
    2004).**                                                      
|               
|10(iii)(A) 12   |  | Lucent Technologies Inc.
    Supplemental Pension Plan (Exhibit 10(iii)(A) 8 to the
    Annual Report on Form 10-K for the year ended
    September 30, 2004).**                                                       
|               
|10(iii)(A) 13   |  | Employment Agreement, dated
    January 6, 2002, between Patricia F. Russo and Lucent
    Technologies Inc. (Exhibit 10(iii)(A)(1) to Quarterly
    Report on Form 10-Q for the quarter ended December 31,
    2001).**
|               
|10(iii)(A) 14   |  | Summary of compensation of named
    executive officers.**                                                                                                                                                             
|               
|10(iii)(A) 15   |  | Summary of compensation terms for
    non-employee directors.**                                                                                                                                                        
|               
|10(iii)(A) 16   |  | Officer Severance Policy for James
    K. Brewington, dated January 23, 2001
    (Exhibit 10(iii)(A)(13) to the Annual Report on
    Form 10-K for the year ended September 30, 2003).**                               
|               
|10(iii)(A) 17   |  | Officer Severance Policy for
    Cynthia K. Christy-Langenfeld, dated January 23, 2001.**                                                                                                                              
|               
|10(iii)(A) 18   |  | Officer Severance Policy for Frank
    A. DAmelio, dated January 23, 2001.**                                                                                                                                          
|               
|10(iii)(A) 19   |  | Officer Severance Policy for Janet
    G. Davidson, dated January 23, 2001
    (Exhibit 10(iii)(A)(14) to the Annual Report on
    Form 10-K for the year ended September 30, 2003).**                                 
|               
|10(iii)(A) 20   |  | Lucent Technologies Executive
    Officer Severance Policy (Exhibit 10(iii)(A) 18 to the
    Annual Report on Form 10-K for the year ended
    September 30, 2004).**                                                  
|               
|10(iii)(A) 21   |  | Lucent Technologies Officer
    Severance Program.**                                                                                                                                                                   
|               
|12              |  | Computation of Ratio of Earnings to
    Combined Fixed Charges and Preferred Stock Dividend Requirements
    and Deficiency of Earnings to Cover Combined Fixed Charges and
    Preferred Stock Dividend Requirements. 

33



---



##### Table of Contents



|     |  |                                                                                                                                                                                               
|---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|13   |  | Selected portions (pages F-1 to
    F-80) of Lucent Technologies Inc.s Annual Report to
    Shareowners for the year ended September 30, 2005.                                               
|    
|14   |  | Lucent Technologies Code of Ethics
    for Chief Executive Officer and Senior Financial Officers
    (Exhibit 14 to the Annual Report on Form 10-K for the
    year ended September 30, 2003).
|    
|21   |  | List of subsidiaries of Lucent
    Technologies Inc.                                                                                                                                          
|    
|23   |  | Consent of PricewaterhouseCoopers
    LLP.                                                                                                                                                    
|    
|24   |  | Powers of Attorney executed by
    directors who signed this report.                                                                                                                          
|    
|31.1 |  | Certification of Patricia F. Russo
    required by Rule 13a-14(a) (17 C.F.R. 240.13a-14(a)).                                                                                                  
|    
|31.2 |  | Certification of Frank A.
    DAmelio required by Rule 13a-14(a) (17 C.F.R.
    240.13a-14(a)).                                                                                              
|    
|32   |  | Certification of Patricia F. Russo
    and Frank A. DAmelio pursuant to 18 U.S.C.
    Section 1350, as adopted pursuant to Section 906 of
    the Sarbanes-Oxley Act of 2002.                
|    
|99.1 |  | Description of capital stock
    (Exhibit 99(i) to Quarterly Report on Form 10-Q for
    the quarter ended December 31, 2001).                                                                





34