Nortel

Nortel

January 11, 2005 11:30 ET

Smartcom Takes 3G Wireless Services Nationwide in Chile with Nortel Technology


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: NORTEL

NYSE, TSX SYMBOL: NT

JANUARY 11, 2005 - 11:30 ET

Smartcom Takes 3G Wireless Services Nationwide in
Chile with Nortel Technology

SANTIAGO, Chile--(CCNMatthews - Jan 11, 2005) -

Smartcom, a leading wireless operator in Chile and an affiliate of
Spain's Grupo Endesa, is expanding its third generation (3G) wireless
network to boost capacity and meet growing nationwide demand for
advanced data services using CDMA2000 1X technology from Nortel
(NYSE:NT)(TSX:NT).

Smartcom has been operating a CDMA 1X network in Santiago based on
Nortel solutions since 2002. With the expansion, Smartcom will be able
to offer advanced mobile services like high-speed Internet access,
e-mail with attached files, image and video downloading, and video
streaming to subscribers throughout Chile.

"We are continuously working to bring our subscribers the best in
high-speed mobile services," said Jaime Gros, general manager, Smartcom.
"Smartcom first launched 1xRTT in Santiago with Nortel technology back
in 2002, and last year we launched 1xEV-DO broadband wireless services
in the capital with Nortel technology. Our successful deployments with
Nortel have kept us at the forefront of wireless services in Chile and
our experience in broadband wireless network deployments has enabled us
to provide current and potential customers with one of the most
extensive arrays of broadband mobile services available today in Chile
and in the world!"

Nortel is installing both core and access equipment -- including
switching platforms, radio base stations and base station controllers --
to upgrade Smartcom's existing nationwide CDMA2000 network to a CDMA 1X
infrastructure. The first phase of the project, focused on the south of
Chile, has already been completed. Smartcom expects to start offering
new services there immediately, in time for the influx of visitors
during Chile's summer months. The entire project is expected to be
completed by the end of 2005.

"As a leading provider of advanced wireless infrastructure in Latin
America, Nortel is proud to have been chosen once more by Smartcom to
help with their latest network evolution project," said Chris Zanyk,
country manager, Nortel Chile. "Deploying our CDMA 1X solutions
nationwide will position Smartcom to drive new, revenue-generating
applications, delivering added value to its customers."

Nortel has been working with Smartcom since 2001, when the two companies
began deployment of a CDMA 1X network in Santiago. They completed Latin
America's first commercial 3G wireless call in November of that year.
With subsequent network expansions and deployment of Nortel CDMA2000
1xEV-DO technology in Santiago, Smartcom now operates one of the fastest
and most advanced wireless networks in the Southern Cone of Latin
America.

"This project reaffirms our commitment to building secure and reliable
communication networks that help enhance the human experience in the
region and around the world," said Kevin Taylor, vice president,
Wireless Networks, Caribbean and Latin America, Nortel. "We enjoy
working with innovative operators like Smartcom and will continue to
provide our extensive expertise in broadband wireless technologies to
help them reach their business objectives."

Nortel has designed, deployed and launched more than 300 wireless
networks in more than 50 countries around the world. Nortel was the
first industry supplier to have wireless networks operating in all
advanced radio technologies (GSM/GPRS/EDGE, CDMA2000 1X and EV-DO, UMTS
and WLAN), and is the only end-to-end supplier of all new generation
wireless solutions.

About Smartcom

Smartcom, of Spain's Endesa Group, is the third leading wireless
operator in Chile, with over 1.5 million customers. With its continuous
innovation, today Smartcom is incorporating the most advanced,
high-speed wireless data technology as part of its ongoing corporate
re-launch program.

About Nortel

Nortel is a recognized leader in delivering communications capabilities
that enhance the human experience, ignite and power global commerce, and
secure and protect the world's most critical information. Serving both
service provider and enterprise customers, Nortel delivers innovative
technology solutions encompassing end-to-end broadband, Voice over IP,
multimedia services and applications, and wireless broadband designed to
help people solve the world's greatest challenges. Nortel does business
in more than 150 countries. For more information, visit Nortel on the
Web at www.nortel.com. For the latest Nortel news, visit
www.nortel.com/news.

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 regulatory and
criminal investigations and civil litigation actions related to Nortel's
restatements and the impact any resulting legal judgments, settlements,
penalties and expenses could have on Nortel's results of operations,
financial condition and liquidity; the findings of Nortel's independent
review and implementation of recommended remedial measures; the outcome
of the independent review with respect to revenues for specific
identified transactions, which review will have a particular emphasis on
the underlying conduct that led to the initial recognition of these
revenues; the restatement or revisions of Nortel's previously announced
or filed financial results and resulting negative publicity; the
existence of material weaknesses in Nortel's internal controls over
financial reporting; the impact of Nortel's and NNL's failure to timely
file their financial statements and related periodic reports, including
breach of its support facility and public debt obligations and Nortel's
inability to access its shelf registration statement filed with the
United States Securities and Exchange Commission (SEC); ongoing SEC
reviews, which may result in changes to our public filings; the
potential delisting or suspension of Nortel's and NNL's publicly traded
securities; the impact of management changes, including the termination
for cause of Nortel's former CEO, CFO and Controller in August 2004; the
sufficiency of Nortel's restructuring activities, including the work
plan announced on August 19, 2004 as updated on September 30, 2004,
including the potential for higher actual costs to be incurred in
connection with restructuring actions compared to the estimated costs of
such actions;

cautious or reduced spending by Nortel's customers; fluctuations in
Nortel's operating results and general industry, economic and market
conditions and growth rates; fluctuations in Nortel's cash flow, level
of outstanding debt and current debt ratings; Nortel's ability to
recruit and retain qualified employees; the use of cash collateral to
support Nortel's normal course business activities; the dependence on
Nortel's subsidiaries for funding; the impact of Nortel's defined
benefit plans and deferred tax assets on results of operations and
Nortel's cash flow; the adverse resolution of class actions, litigation
in the ordinary course of business, intellectual property disputes and
similar matters; Nortel's dependence on new product development and its
ability to predict market demand for particular products; Nortel's
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's 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, which is
currently not available, of Nortel's forward purchase contracts; the
impact of Nortel's 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; and the
future success of Nortel's strategic alliances.

For additional information with respect to certain of these and other
factors, see the most recent Annual Report on Form 10-K filed by Nortel
with the SEC. Unless otherwise required by applicable securities laws,
Nortel disclaims any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.

Nortel, the Nortel logo and the Globemark are trademarks of Nortel
Networks. CDMA2000 is a trademark of the Telecommunications Industry
Association (TIA).

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