Canbra Awards Nortel Networks an Estimated US$500 Million Contract To Build Brazil's First Alternative Telecommunications Network - Company Business and Marketing

Cambridge Telcom Report, August 23, 1999

Canbra (Mirror S.A.) has awarded Nortel Networks (NYSE/TSE: NT) a five-year contract worth an estimated US$500 million, for a Unified Networks solution that will deliver advanced data and telephony services in Rio de Janeiro and 15 other east coast and northern states in Brazil.

Nortel Networks will design and build a turnkey network solution for Canbra, including Nortel Networks Proximity II and cdmaOne fixed wireless access equipment, digital switching systems, Optical Internet solutions, PBX and call center equipment. Deployment will begin immediately in Rio de Janeiro, Minas Gerais, and Bahia, followed by deployment in the other 13 states of Canbra's region. Commercial service is scheduled to start in the fourth quarter of 1999.

"Nortel Networks was one of the network providers to offer the set of attributes we were looking for - cutting edge fixed wireless and CDMA technology, extensive experience in building integrated networks, a strong knowledge of the Latin American market and the ability to deliver networks quickly," said Francisco de Assis, vice-president of engineering, Canbra.

"The privatization and deregulation of Brazil's telecommunications industry have brought world-class services and features to Brazilian customers," said Dan Hunt, president, Nortel Networks CALA (Caribbean and Latin America). "We're proud to be providing Canbra the technology that will enable them to meet customers' expectations. This underscores our leadership in Unified Networks solutions, and our strength in the region."

Nortel Networks' awards year-to-date in the Caribbean and Latin America region include: one of the world's largest fixed wireless access networks for AXtel in Mexico; an advanced pan-regional optical data network for IMPSAT; a Unified Networks solution for FirstComm in Peru; a country-wide CDMA digital wireless network for Haitel in Haiti; and TDMA digital wireless networks for Norte Brasil Telecom and BellSouth Chile.

Canbra was awarded a "mirror company" (alternative) license to compete with Telemar, one of the companies formed as a result of the privatization of the former Telebras system. Upon completion, the Canbra network will reach 51 municipalities in an area - with a combined population of more 87 million people - and approximately five million square kilometers (3.1 million square miles), roughly half the size of continental United States. Nortel Networks' wireless solutions will cover more than 84 percent of Brazil's territory.

Canbra was formed by Bell Canada International (34.4 percent), US-based VeloCom Inc., formerly WLL International (34.4 percent), and QUALCOMM (16.2 percent), Argentina-based Grupo Liberman (12.5 percent), and Taquari Participa\007oes (2.5 percent) from Brazil.

Nortel Networks delivers value to customers around the world through Unified Networks solutions, spanning mission-critical telephony and IP-optimized networks. Customers include public and private enterprises and institutions; Internet service providers; local, long-distance, cellular and PCS communications companies, cable television carriers, and utilities.

Nortel Networks' common shares are listed on the New York, Toronto, Montreal and London stock exchanges. Nortel Networks had 1998 revenues of US$17.6 billion and has approximately 76,000 employees worldwide.