Nortel Solutions to Protect China Customs Business-Critical Information; DWDM Upgrade Will Enable Secure, Reliable, Real-Time Data Storage, Retrieval

Business Wire, March 21, 2005

BEIJING -- To improve network speed and efficiency, provide highly reliable backup and redundancy, and ensure uninterrupted access to business-critical information in real-time, the Customs General Administration of the People's Republic of China has selected an optical transport solution from Nortel (NYSE/TSX: NT) to upgrade its storage network infrastructure.

Using Nortel's Optical Metro DWDM (dense wavelength division multiplexing) technology, China Customs will extend its networked storage capabilities from its main data center in Beijing to multiple sites across major metropolitan areas. Delivering a comprehensive set of services and applications, the Nortel solution will provide a scalable platform for China Customs to meet future applications as well as its growing data storage and retrieval requirements.

"Nortel is at the forefront of delivering leading solutions to enterprise and government customers around the world," said Stephen Tsui, chief operating officer, Greater China, Nortel, "With our DWDM communication services, China Customs will be able to back up critical data in real-time, maximize the efficiency of server resources, and provide fast access to data for recovery in emergencies."

The new China Customs deployment will also support the state-owned Golden Customs initiative, a nationwide project developed to connect the information networks of the customs and foreign trade sectors, promote EDI (electronic data interchange) business communication, and supplement information exchanged on networks with magnetic media.

China Customs' first storage network using DWDM technology will be based on Nortel Optical Metro 5200, which delivers up to 32 protected or 64 unprotected DWDM wavelengths and offers up to 10Gbps per wavelength via a network modeling tool that simplifies and enhances the efficiency of DWDM deployment and operation. This solution offers an optimized storage and transport architecture that delivers 'five nines' reliability.

The China Customs network upgrade will also include the compact Nortel Optical Multiservice Edge 6110 to provide low-cost, multiservice aggregation and transport of client services over SONET/SDH networks, and Nortel Optical Metro 1200, a new carrier-class device to simplify delivery of Ethernet services. These enhancements will enable China Customs to access affordable, broadband optical services that support high-bandwidth applications, including business continuity and disaster recovery, Storage Area Networking (SAN) extension, video content networking and streaming media.

The Nortel Optical Metro 5000 Multiservice Platform provides DWDM and CWDM (coarse wavelength division multiplexing) optical solutions, with over 10,000 network elements deployed and over 27,000 wavelengths lit worldwide. Deployed in more than 1,000 customer networks in 65 countries, Nortel's end-to-end optical network portfolio includes next generation SONET/SDH, optical switching products, photonics (WDM), and Optical Ethernet products. Nortel was the market share leader in DWDM transport for the fifth year in a row as of year end 2004, according to the Dell'Oro Group.

In China, Nortel's converged data network solutions have been implemented in many industries, including utilities, banking and government. Nortel has also supplied a range of strategic networking solutions to key state-owned projects such as Golden Customs and Golden Taxation, a national information network linking state taxation headquarters with local taxation offices at all levels.

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;