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(NT.TO) China Netcom Selects Nortel Networks to Provide Voice over IP, Multimedia Solutions for Next Generation Network

Posted on: Tuesday, 26 August 2003, 06:00 CDT

BEIJING--(BUSINESS WIRE)--Aug. 26, 2003--

Plans to Launch New Voice, Video, Multimedia Services in Shandong

Province

China Netcom subsidiary Shandong Netcom has selected Nortel Networks (NYSE:NT)(TSX:NT) to be the exclusive equipment supplier for a next generation network expected to bring broadband voice, data, video and multimedia services to three major cities in Shandong Province.

Nortel Networks will supply Shandong Netcom with products from Nortel Networks Multimedia Communications and Succession voice over Internet Protocol (IP) portfolios under an agreement announced today.

The network will position Shandong Netcom to provide new services initially in Qingdao, Jinan and Tai'an. It will support a variety of service delivery methods, including 'twisted pair' phone lines, Asynchronous Digital Subscriber Line (ADSL), hybrid fiber coax (HFC) cable and Ethernet.

"Nortel Networks was selected for its proven record of next generation network deployment and network reliability, as well as its ability to position service providers to drive new revenue opportunities while fully leveraging existing network investments," said Robert Mao, president and chief executive officer, Greater China, Nortel Networks.

"Nortel Networks was the first vendor to deploy networks in all voice over IP market segments, including local, long distance, wireless and cable," Mao said. "In China, Nortel Networks has a very strong and talented research and development team to support local market customization, which enables us to provide responsive support to our local customers."

China Railcom recently selected Nortel Networks as the exclusive equipment supplier for its next generation network in Chongqing, the largest city in Southwest China. Hong Kong Broadband recently deployed a Nortel Networks solution for what has become one of the largest voice over IP networks in the world.

Nortel Networks solution for Shandong Netcom will include Nortel Networks Multimedia Communication Server 5200 (formerly known as Interactive Multimedia Server or IMS). Part of Nortel Networks Multimedia Communications Portfolio, Multimedia Communication Server 5200 is a SIP (session initiation protocol)-based media and applications server. It leverages an open, standards-based architecture and commercially available hardware and software, positioning service providers to offer advanced multimedia and collaboration applications for businesses and consumers.

Shandong Netcom's next generation network will also include Nortel Networks Succession Communication Server 2000 - Compact superclass softswitch. This provides call control (connection between caller and called party), delivers a full set of voice services, and sets the stage for future services. A superclass softswitch meets all criteria for 'true' service provider circuit-to-packet migration, including local, tandem and long distance capability on a single platform; full business and residential telephony service sets and carrier-grade reliability and scalability.

Nortel Networks will also provide Shandong Netcom with Nortel Networks Passport Packet Voice Gateways, Integrated Access Devices (IAD), SIP phones, SIP video phones, and SIP soft clients.

Shandong Netcom is one of the largest subsidiaries of China Netcom Corporation (CNC), the country's major fixed-line operator. CNC provides a full spectrum of services and solutions to meet the broadband telecommunications needs of businesses and individuals in China. Its core business includes providing Internet broadband access and integrated telecom services to residential and corporate customers, and building the infrastructure. Its comprehensive collection of telecom licenses, including the license to operate international gateways out of China, puts it in peer with incumbent operators such as China Telecom.

Nortel Networks is an industry leader and innovator focused on transforming how the world communicates and exchanges information. 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.

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 severity and duration of the industry adjustment; the sufficiency of our 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; fluctuations in operating results and general industry, economic and market conditions and growth rates; the ability to recruit and retain qualified employees; fluctuations in cash flow, the level of outstanding debt and debt ratings; the ability to meet financial covenants contained in our credit agreements; the ability to make acquisitions and/or 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; 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; the dependence on new product development; the uncertainties of the Internet; the impact of the credit risks of our customers and the impact of customer financing and commitments; stock market volatility; the entrance into an increased number of supply and outsourcing contracts which contain delivery and installation provisions, which, if not met, could result in the payment of substantial penalties or liquidated damages; the ability to obtain timely, adequate and reasonably priced component parts from suppliers and internal manufacturing capacity; the impact of our asset and liability review; the future success of our strategic alliances; and the adverse resolution of litigation. For additional information with respect to certain of these and other factors, see the reports 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.

Nortel Networks, the Nortel Networks logo, the Globemark, Succession and Passport are trademarks of Nortel Networks.

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