Nortel

Nortel

March 28, 2005 22:15 ET

Nortel Delivers New Communications Power to China Electricity and Water Utilities; Nortel IP Telephony, Multimedia Portfolio Deployed for Network Upgrades


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: NORTEL

NYSE, TSX SYMBOL: NT

MARCH 28, 2005 - 22:15 ET

Nortel Delivers New Communications Power to China
Electricity and Water Utilities; Nortel IP Telephony,
Multimedia Portfolio Deployed for Network Upgrades

BEIJING--(CCNMatthews - Mar 28, 2005) -

Regional power utilities in Fujian and Shandong provinces and the Haihe
River Water Resources Commission will drive increased employee
productivity through 'anywhere, anytime' communication services with the
deployment of industry-leading Internet Protocol (IP)-based converged
network solutions from Nortel (NYSE:NT)(TSX:NT).

"Many utility employees work at different locations throughout each
day," said Stephen Tsui, chief operating officer, Greater China, Nortel.
"Nortel solutions that converge multiple networks into one make it
possible for them to communicate cost-effectively from virtually
anywhere at anytime over a wired or wireless connection."

"These Nortel enterprise converged solutions are igniting and powering
local commerce in many markets, as well as enhancing the human
experience by providing unrestricted communications mobility and
multimedia collaboration," Tsui said. "We have a long relationship with
China's power industry and water resources companies, and we continue to
support them with leading communication solutions."

Fujian Power is upgrading remote sites across its countryside
communication network with Nortel traditional telephony and IP telephony
to increase employee productivity with collaborative multimedia
applications and mobile workforce communications solutions. Based on
Nortel Communication Server 1000 (CS 1000), the full-featured IP
telephony solution for the enterprise environment will deliver the full
range of Nortel's proven telephony applications. The new network is
expected to be the first of its kind in Fujian province.

In Shandong province, the Qingdao Power Company is deploying a Nortel
Multimedia Communications Server 5100 (MCS 5100) and a CS 1000 to
upgrade its communications to a fully converged, next generation network
(NGN). MCS 5100 is a network-based application delivery solution that
seamlessly integrates voice, data, and video services to allow personnel
to conduct business virtually anywhere, anytime. By providing employee
mobility, workgroup collaboration, instant messaging and IP telephony,
the new Qingdao Power Company network infrastructure will reduce
operating costs and enhance efficiency. As Shandong's second largest
city and its economic center, Qingdao will be the first city in the
province to upgrade its power communication network.

The Haihe River Water Resources Commission, the largest water system in
North China, is deploying both Nortel MCS 5100 and CS 1000 to create a
new, flexible, reliable and responsive multiservice communication
network. The new network will connect various water resource management
functions across the Haihe River area and allow its employees to
communicate securely and reliably in real-time regardless of location.
Once completed, the network is expected to be the first multiservice
network in China's water resources system.

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 April 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 and consolidation 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 and Quarterly
Report on Form 10-Q 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.

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