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<p>New Products, Capabilities Optimize Voice, Video, Multimedia Applications, Business Continuity</p>
<p>SANTA CLARA, Calif. – Enterprises around the world are expected to have more opportunities to increase revenue and improve employee productivity through enhancements announced by Nortel Networks*</p>
<p>[NYSE/TSX: NT] to its convergence-ready data product portfolio.
These enhancements are designed to simplify the transition from multiple voice and data networks to a single converged infrastructure.</p>
<p>This makes it possible for small-to-medium businesses (SMB) and enterprise customers to have greater integration with their customer and partner networks, regardless of whether they are fully converged or at the initial stages of migration.</p>
<p>“Nortel Networks has been proactive in providing a comprehensive architecture and prescriptive designs for building converged infrastructures,” said Atul Bhatnagar, vice president and general manager, Enterprise Data Networks, Nortel Networks. “Today’s announcement helps take customers and businesses forward by improving the building blocks needed to ensure today’s network is tuned for critical services such as IP Telephony, SIP multimedia applications and video. This approach enables customers to implement converged network services with confidence in a cost effective, reliable manner at their own pace.”</p>
<p>“We measure IT success in simple terms – our ability to provide uninterrupted access to our county government services by our constituents and access to our applications that enable our employees to do their jobs as effectively as possible,” said Chad Fuller, director of information systems for Licking County, Ohio. “Network downtime means we cannot serve the public. The product enhancements from Nortel Networks enable the continuous availability of our infrastructure and applications, which help us to assist those who depend on us. Moreover, providing these new products at an attractive price point enables us to be the best possible stewards of county tax dollars.
That’s the best return on investment model there is.”</p>
<p>The new capabilities of the convergence-ready data portfolio enable customers to fortify their local area networks (LAN) at their own pace as they implement IP Telephony, video, SIP-based collaboration applications and other technologies. Specifically, this allows customers and businesses to realize the full promise of convergence via product upgrades to security, resiliency, availability and fail-over capabilities.</p>
<p>The first new elements are additions to Nortel Networks data switching product line, including Nortel Networks BayStack* 325-24T, 325-24G and 425-48T. These new switches are targeted at the SMB segment and offer Nortel Networks cornerstone attributes of simplicity, features and functionality of the award-winning BayStack products, along with the price and performance characteristics aimed at the SMB segment. The switches are simple to deploy and configure and can accommodate new software releases as they become available, intelligently ‘future-proofing’ the customers’ infrastructure as they migrate to a converged communications environment.</p>
<p>In addition to the new SMB-focused products, Nortel Networks introduced enhanced features and functionality to existing products to enable enterprises of all sizes to deploy convergence-ready networks.
Providing fault-tolerant network solutions is critical to enable enterprises of all sizes to deploy a converged communications infrastructure. Most network recovery mechanisms require valuable seconds to recover from an outage. To address this challenge, Nortel Networks is also introducing enhanced features and functionality on existing products to ensure the viability of the infrastructure for latency-sensitive applications like telephony or streaming media applications. Specifically, Nortel Networks has bolstered Nortel Networks Passport* 8600 Routing Switches deployed in the network core with Routed-Split Multi-Link Trunking (RSMLT), available with the latest code release for the 3.7 operating system. The RSMLT capabilities are among the most resilient, high-availability infrastructure configuration available.</p>
<p>“Nortel Networks innovation and enhancements to their networking equipment have allowed us to smoothly roll out more services and applications,” said Beth Chancellor, director of telecommunications, University of Missouri. “We are looking forward to implementing the resiliency and availability capabilities so we can transition to an all-IP infrastructure with confidence that the applications we’ve deployed will be continuously accessible and that our infrastructure is safegaurded against monumental failures caused by otherwise minor issues.”</p>
<p>Now generally-available and providing the hallmarks of performance, resilience and security of the Nortel Networks brand is Nortel Networks Passport 8300 Ethernet Switch. With Gigabit speeds and Power-over-Ethernet capabilities, this new Ethernet switch offers quality of service to ensure latency-sensitive applications are not compromised while featuring industry-leading security capabilities.</p>
<p>Enhancements to Nortel Networks BayStack 5510 series stackable switches enabled via the BayStack operating system Switching Software (BoSS) 4.0 suite provide customers with the ability to deploy greater security and even greater control for network management.
“Being a University, our infrastructure needs are at times different from those of the typical enterprise,” Chancellor said. “We need to ensure that network resources are available to serve our students and academic needs as well as for administrative needs. The benefits of Nortel Networks operating system switching software enable us to manage our infrastructure more effectively. The features enable simplified deployment, enhanced security and greater control over bandwidth allocation – and the routing features of the product have effectively accounted for the future requirements of our network.”</p>
<p>Nortel Networks continues to enhance the management capabilities to support converged networks with Nortel Networks Optivity* suite. The new Optivity Network Management System 10.2 enables seamless management of the converged voice and data infrastructure. Optivity Policy Service 4.0 supports both centralized QoS and network access security provisioning. Nortel Networks Optivity Switch Manager release 4.0 minimizes network administration complexity and cost by enabling a single management station to automate the configuration of multiple Nortel Networks data switching products, including wireless networking equipment.</p>
<p>Nine of 10 FORTUNE 500 customers rely on Nortel Networks to eliminate the barriers to communication that inhibit business. As the only company to have deployed more than 50 million enterprise telephony lines and 50 million Ethernet ports. Nortel Networks is uniquely able to provide convergence solutions to customers of all sizes and types.
Nortel Networks is an industry leader and innovator focused on transforming how the world communicates and exchanges information.</p>
<p>The Company is supplying its service provider and enterprise customers with communications technology and infrastructure to enable value-added IP data, voice and multimedia services spanning Wireless Networks, Wireline Networks, Enterprise Networks, and Optical Networks. As a global company, Nortel Networks does business in more than 150 countries. More information about Nortel Networks can be found on the Web at www.nortelnetworks.com and at www.nortelnetworks/media_center.</p>
<p>Certain information included in this press release is forward-looking and is subject to important risks and uncertainties. The results or events predicted in these statements may differ materially from actual results or events. Factors which could cause results or events to differ from current expectations include, among other things: the outcome of Nortel Networks independent review and planned restatement of its previously announced or filed financial results; the impact of the management changes announced on April 28, 2004; the impact of the inability to meet Nortel Networks filing obligations on support facilities and public debt obligations; the sufficiency of Nortel Networks restructuring activities, including the potential for higher actual costs to be incurred in connection with restructuring actions compared to the estimated costs of such actions; continued reductions in spending by Nortel Networks customers; fluctuations in Nortel Networks operating results and general industry, economic and market conditions and growth rates; the communication by Nortel Networks auditors of the existence of material weaknesses in internal control; Nortel Networks ability to recruit and retain qualified employees; fluctuations in Nortel Networks cash flow, level of outstanding debt and current debt ratings; the use of cash collateral to support Nortel Networks normal course business activities; the dependence on Nortel Networks subsidiaries for funding; the impact of Nortel Networks defined benefit plans and deferred tax assets on results of operations and Nortel Networks cash flows; Nortel Networks dependence on new product development and its ability to predict market demand for particular products; Nortel Networks ability to integrate the operations and technologies of acquired businesses in an effective manner; the impact of rapid technological and market change; the impact of price and product competition; barriers to international growth and global economic conditions, particularly in emerging markets and including interest rate and currency exchange rate fluctuations; the impact of rationalization in the telecommunications industry; changes in regulation of the Internet; the impact of the credit risks of Nortel Networks customers and the impact of customer financing and commitments; stock market volatility generally and as a result of acceleration of the settlement date or early settlement of Nortel Networks purchase contracts; the impact of Nortel Networks supply and outsourcing contracts that contain delivery and installation provisions, which, if not met, could result in the payment of substantial penalties or liquidated damages; the future success of Nortel Networks strategic alliances; and the adverse resolution of litigation, investigations, intellectual property disputes and similar matters. For additional information with respect to certain of these and other factors, see the most recent Form 10 Q/A and Form 10-K/A filed by Nortel Networks with the United States Securities and Exchange Commission. Unless otherwise required by applicable securities laws, Nortel Networks disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.</p>
<p>*Nortel Networks, the Nortel Networks logo, the Globemark, Business Without Boundaries, BayStack, Passport and Optivity are trademarks of Nortel Networks.</p>
<p>Use of the terms “partner” and “partnership” does not imply a legal partnership relationship between Nortel Networks and any other party.</p>