Hot Telecom has selected communications solutions provider Nortel to carry out the next upgrade to its telephone system, a move HOT said its carrying out in response to growing customer demand for its telephone service. "The main reason we are adding the switch is to allow us to add more customers," said Saar Rosenberg, marketing manager of strategic clients at HOT. "It is part of our natural growth in developing the service." The upgrade, which came at a cost of $5 million, will establish HOT's third switch on its telephone network and the second one deployed by Canada-based Nortel - the other being powered by Gallery. Having launched its telephone service in November 2004 and being widely criticized for its slow penetration of Bezeq's market share, HOT has since signed up over 115,000 subscribers. Rosenberg said the new switch would also improve the quality of the service "which is increasing all the time." Rosenberg added that a further upgrade was likely in the near future but would not comment at which level of customer growth that would occur. The latest network upgrade is expected to be fully deployed by the end of the year. HOT will deploy a Nortel Internet-based solution using network engineering, integration, operation and maintenance services from Nortel's Global Services portfolio. This will allow HOT to expand the services it provides to include managed VoIP (Voice over Internet Protocol), instant messaging and presence awareness to its product portfolio. Sorin Lupu, president, Eastern Region EMEA at Nortel said these services would help the HOT build its subscriber base and reduce operational costs. The deal marks another stage in the relationship between the two companies after Nortel recently integrated HOT's enterprise network in.