Optus Selects Nortel Networks for Next Generation Optical and Voice Networks

Business Wire, April 3, 2002

Business Editors & High Tech Writers

SYDNEY, Australia--(BUSINESS WIRE)--April 3, 2002

Expected to Drive Reduced Costs, Lay Foundation for New Services

In a move expected to drive new revenues and reduced capital and operating costs, Optus has selected Nortel Networks (NYSE:NT) (TSE:NT.) to supply next generation optical and voice networks. This five-year supply and services agreement is estimated to be worth approximately US$175 million (A$350 million).

Under the terms of the agreement, Nortel Networks expects to build a 10 gigabits-per-second, dense wavelength division multiplexing (DWDM) link between Brisbane and Perth, completing national rollout of Optus' DWDM optical network. Nortel Networks will extend Optus' DWDM access into Australia's metropolitan areas, positioning the carrier to provide wholesale and business customers with new, revenue-generating services such as high-speed leased lines, managed wavelengths, Gigabit Ethernet and optical storage area networking.

Optus plans to deploy Nortel Networks OPTera Connect HDX and OPTera Connect DX bandwidth managers to cost effectively interconnect its long haul and metropolitan transmission networks.

In addition, Nortel Networks plans to upgrade the existing Optus DMS voice switches to enable them for packet voice. Nortel Networks expects to deploy a next generation, packet-based voice solution for Optus, including Nortel Networks Succession softswitches. By packetizing its voice network, Optus would be positioned to deliver all of its current, high-quality telephony services while simplifying its network and driving cost reductions.

"This agreement positions Optus to deploy the state-of-the-art capabilities we need to continually improve services and technology for our customers," said Dr Stephen Rotheram, managing director, networks for Optus.

"Nortel Networks is focusing on its fundamental strength - the ability to build highly reliable networks for the cost-effective delivery of new services," said Steve Wood, president, Nortel Networks Australia and New Zealand.

"With our broad networking portfolio and detailed understanding of how to build large, converged networks, we are in a unique position to deliver this kind of network transformation," Wood said.

Under the agreement, the network will include Nortel Networks OPTera Long Haul 1600 Optical Line System and OPTera Connect DX and OPTera Connect HDX, connecting Australian cities over Optus' long haul infrastructure, delivering end-to-end service connectivity, provisioning and wavelength management. Furthermore, Optus will use Nortel Networks DWDM optics technology between line and terminal systems, which will provide further capital and operational benefits. Extending the optical network into and around Australian metropolitan areas will be OPTera Metro solutions, including OPTera Metro 5200 and OPTera Metro 4000 series multiservice platforms. This will provide Optus customers with direct access to affordable broadband optical services such as high-speed Internet access and streaming video.

Nortel Networks Succession packet voice portfolio enables cost-effective delivery of next generation voice services. Nortel Networks Succession Communication Server 2000 softswitch and Passport Packet Voice Gateway are expected to be key products for Optus. Succession softswitch offers a rich variety of highly scalable call processing features and network services for carriers, facilitating easy addition of new subscribers and new services as demand increases. Succession would also allow Optus to efficiently migrate its voice network while protecting previous investments and retaining mission-critical reliability.

Under the agreement, Nortel Networks specialists will also work closely with Optus to assist in bringing new services to market.

Optus is an Australian leader in integrated communications, serving more than five million customers. The company provides a broad range of communications services including mobile, national and long distance services, local telephony, international telephony, business network services, Internet and satellite services and pay television. Optus is divided into three major business areas: Mobile, Business and Consumer & Multimedia. In 2001, SingTel became the parent company of Optus, paving the way for Optus to become a strong, strategic player in Asia-Pacific telecommunications. Visit Optus at www.optus.net.au.

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 Metro and Enterprise Networks, Wireless Networks and Optical Long Haul 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 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 increased provision of customer financing and commitments; stock market volatility; the entrance into an increased number of supply, turnkey, and outsourcing contracts which contain delivery, installation, and performance 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 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.