Nortel, NDS Unite to Create New IPTV Capabilities

Market Wire, March, 2007

Nortel(1) (TSX: NT)(NYSE: NT) and NDS(2) (NASDAQ: NNDS), a leading provider of technology solutions for digital pay-TV, announced they are collaborating on a new set of IPTV services for the European market that will dramatically change today's television experience through the convergence of entertainment and communications.

Nortel has signed a global reseller and joint marketing agreement with NDS, and the companies are working together to facilitate the integration of Nortel's voice and multimedia features into the TV environment.

Plans include integrating Nortel's voice and multimedia products into NDS' MediaHighway(2) middleware, to produce a new set of communications services for television. The expected result will be one of the most advanced and feature-rich middleware products in the television distribution industry, giving IPTV service providers a powerful platform to attract and retain customers. The solution will deliver an enriched user experience through the ability to control various communication services from the TV. Planned features include caller ID, call handling, address book, click-to-dial, call-logs, IM messaging and other IP-based communication services.

"We chose NDS because it is a leader in the digital broadcast industry and has a proven middleware product that is well suited for IPTV communications integration," said George Riedel, chief strategy officer, Nortel. "Working together we can deliver a new set of exciting services which blend TV entertainment with voice and multimedia services."

"NDS is delighted to be working with Nortel on new IPTV products that will set us apart from the rest of the industry," said Nigel Smith, vice president, NDS Broadband Internet Group. "Nortel's strength in voice and multimedia, coupled with its IPTV systems integration capability, is a perfect complement to our middleware portfolio and to our experience in digital broadcasting"

Both companies fundamentally support the use of open standards and open architecture. Nortel is an active leader and contributor in the IPTV standards bodies while NDS' MediaHighway is based on an open architecture, relying on Java and HTML for maximum flexibility, which allows new features to be easily integrated into the IPTV platform for faster time-to-market and enhanced competitive advantage for service providers. Its open application programming interfaces also support highly customizable program guides, and an impressive array of advanced gaming and interactive capabilities. The use of open standards encourages the growth of the developer community, which promotes innovation and the continuous creation of new applications.

The first demonstration of a solution from the Nortel and NDS collaboration will be debuted at IPTV World Forum (5-7 March 2007, Olympia, London) in booths 139 (Nortel) and 140 (NDS).

About NDS

NDS Group plc (NASDAQ: NNDS), a majority owned subsidiary of News Corporation, supplies open end-to-end digital technology and services to digital pay-television platform operators and content providers. See www.nds.com for more information about NDS.

About Nortel

Nortel is a recognized leader in delivering communications capabilities that make the promise of Business Made Simple a reality for our customers. Our next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel's technologies are designed to help eliminate today's barriers to efficiency, speed and performance by simplifying networks and connecting people to the information they need, when they need it. Nortel does business in more than 150 countries around the world. For more information, visit Nortel on the Web at www.nortel.com . For the latest Nortel news, visit www.nortel.com /news.

Certain statements in this press release may contain words such as "could", "expects", "may", "anticipates", "believes", "intends", "estimates", "targets", "envisions", "seeks" and other similar language and are considered forward-looking statements or information under applicable securities legislation. These statements are based on Nortel's current expectations, estimates, forecasts and projections about the operating environment, economies and markets in which Nortel operates. These statements are subject to important assumptions, risks and uncertainties, which are difficult to predict and the actual outcome may be materially different. Further, actual results or events could differ materially from those contemplated in forward-looking statements as a result of the following

(i) risks and uncertainties relating to Nortel's restatements and related matters including: Nortel's most recent restatement and two previous restatements of its financial statements and related events; the negative impact on Nortel and NNL of their most recent restatement and delay in filing their financial statements and related periodic reports; legal judgments, fines, penalties or settlements, or any substantial regulatory fines or other penalties or sanctions, related to the ongoing regulatory and criminal investigations of Nortel in the U.S. and Canada; any significant pending civil litigation actions not encompassed by Nortel's proposed class action settlement; any substantial cash payment and/or significant dilution of Nortel's existing equity positions resulting from the approval of its proposed class action settlement; any unsuccessful remediation of Nortel's material weaknesses in internal control over financial reporting resulting in an inability to report Nortel's results of operations and financial condition accurately and in a timely manner; the time required to implement Nortel's remedial measures; Nortel's inability to access, in its current form, its shelf registration filed with the United States Securities and Exchange Commission (SEC), and Nortel's below investment grade credit rating and any further adverse effect on its credit rating due to Nortel's restatements of its financial statements; any adverse affect on Nortel's business and market price of its publicly traded securities arising from continuing negative publicity related to Nortel's restatements; Nortel's potential inability to attract or retain the personnel necessary to achieve its business objectives; any breach by Nortel of the continued listing requirements of the NYSE or TSX causing the NYSE and/or the TSX to commence suspension or delisting procedures;