Centertel Selects Nortel as 3G Wireless Network Supplier in Poland

22 July 2005

PTK Centertel, Poland's leading wireless operator, has selected Nortel* [NYSE/TSX: NT] as a key supplier of third generation (3G) radio equipment to upgrade its wireless access network across Southern Poland.

Based on a new supply agreement, Nortel will provide UMTS ( Universal Mobile Telecommunications System ) equipment and professional services to Centertel, enabling the company to deliver a broad range of data services to its customers like e-mail with large attachments, Internet browsing, personalized content, music and video downloading, streaming and conferencing.

"Nortel is working closely with leading operators to make 3G a reality across the globe," said Peter MacKinnon, president, GSM/UMTS, Nortel. "Our technology is helping operators like Centertel enhance the customer experience by delivering sophisticated data-based services that will change the way consumers and businesses communicate in the coming years."

Nortel professional services will help Centertel operate the network efficiently and optimize network performance. Nortel will continue to support Centertel with maintenance services, including technical support and repair services following the commercial launch.

Nortel previously supplied the GSM ( Global System for Mobile Communications ) and GPRS ( General Packet Radio Service ) wireless access network on which Centertel currently offers voice services in Southern Poland. Centertel has also launched EDGE ( Enhanced Data Rate for GSM Evolution ) data services based on Nortel technology in Krakow, Katowice and Wroclaw, and is currently expanding this coverage to new areas. Centertel's EDGE offering complements its UMTS strategy by extending high-speed coverage to a wider area across the region.

The 3G upgrade agreement builds on a seven-year relationship between Nortel and Centertel. Nortel has been a key supplier to the international France Telecom SA/Orange mobile network for more than 15 years, and currently provides wireless equipment for Orange networks in five countries across Europe.

Centertel is an affiliate of Telekomunikacja Polska SA and the France Telecom group. In November 2004, Mobistar selected Nortel to deploy its national 3G wireless access network across Belgium. In September 2003, Orange selected Nortel as one of three radio technology vendors to support its pan-European 3G access network roll-out, which included various regions in France.

Nortel's 3G network equipment is designed to be easily and cost-effectively deployed on top of existing wireless network hardware. Nortel's UMTS solution is HSDPA ( High Speed Downlink Packet Access )-ready and is designed to easily upgrade to support HSDPA through a software installation. This gives operators the flexibility to cost-effectively upgrade their networks as needed to boost capacity to meet market demand and deliver even faster services. Nortel's 3G radio base stations can be used in mixed GSM/UMTS configurations to further reduce capital and operating expenses.

Nortel has designed, installed and launched more than 300 wireless networks in over 70 countries. Nortel was the industry's first supplier with wireless networks operating in all advanced radio technologies ( GSM/GPRS/EDGE, CDMA2000 1X and 1xEV-DO, UMTS and WLAN ), and is the only end-to-end provider of all next generation wireless solutions, as well as edge and core network solutions for IP, ATM and optical transport.

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, and any related potential dilution of Nortel's common shares; 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 control over financial reporting and the conclusion of Nortel's management and independent auditor that Nortel's internal control over financial reporting is ineffective, which could continue to impact Nortel's ability to report its results of operations and financial condition accurately and in a timely manner; the impact of Nortel's and NNL's failure to timely file their financial statements and related periodic reports, including 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 Nortel's and NNL's public filings; 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 and December 14, 2004, including the potential for higher actual costs to be incurred in connection with restructuring actions compared to the estimated costs of such actions; cautious or reduced spending by Nortel's customers; increased consolidation among Nortel's customers and the loss of customers in certain markets; fluctuations in Nortel's operating results and general industry, economic and market conditions and growth rates; fluctuations in Nortel's cash flow, level of outstanding debt and current debt ratings; Nortel's monitoring of the capital markets for opportunities to improve its capital structure and financial flexibility; Nortel's ability to recruit and retain qualified employees; the use of cash collateral to support Nortel's normal course business activities; the dependence on Nortel's subsidiaries for funding; the impact of Nortel's defined benefit plans and deferred tax assets on results of operations and Nortel's cash flow; the adverse resolution of class actions, litigation in the ordinary course of business, intellectual property disputes and similar matters; Nortel's dependence on new product development and its ability to predict market demand for particular products; Nortel's ability to 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; barriers to international growth and global economic conditions, particularly in emerging markets and including interest rate and currency exchange rate fluctuations; the impact of rationalization and consolidation in the telecommunications industry; changes in regulation of the Internet; the impact of the credit risks of Nortel's customers and the impact of customer financing and commitments; stock market volatility generally and as a result of acceleration of the settlement date of Nortel's forward purchase contracts; negative developments associated with Nortel's supply contracts and contract manufacturing agreements, including as a result of using a sole supplier for a key component of certain optical networks solutions; the impact of Nortel's supply and outsourcing contracts that contain delivery and installation provisions, which, if not met, could result in the payment of substantial penalties or liquidated damages; and the future success of Nortel's strategic alliances. For additional information with respect to certain of these and other factors, see the most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q filed by Nortel with the SEC. Unless otherwise required by applicable securities laws, Nortel 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, the Nortel logo and the Globemark are trademarks of Nortel Networks.

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