Omnitel Vodafone Selects Nortel Networks Wireless Internet Solution for UMTS Rollout.

Business/High-Tech Editors

MILAN, Italy--(BUSINESS WIRE)--May 22, 2001

Nortel Networks Now Building UMTS Networks in UK, U.S.,

Germany, Austria, Spain, Italy

Omnitel Vodafone has selected Nortel Networks (NYSE:NT)(TSE:NT.) to supply Wireless Internet infrastructure

Under terms of an agreement signed today, Nortel Networks will supply radio access infrastructure for deployment in the Omnitel Vodafone UMTS network beginning later this year.

"Time-to-market is vital for success in the race for 3G Wireless Internet," said Vittorio Colao, chief executive officer, Omnitel Vodafone. "We plan to launch commercial 3G wireless service within 2002. We are pleased to work with a leading 3G supplier like Nortel Networks, which has extensive experience and can help ensure best-in-class service delivery and achievement of our targets."

"This is an important win for Nortel Networks in the strategically significant Italian market," said Pascal Debon, president, Nortel Networks EMEA (Europe, Middle East, Africa). "Added to our 3G wins in the UK, Germany, Spain and Austria, this demonstrates continued customer confidence in our ability to deliver and implement 3G networks to key European markets in a cost-effective manner."

"The Omnitel Vodafone agreement gives Nortel Networks a foothold in the potentially lucrative 3G market in Italy," said Maurizio Tucci, managing director, Nortel Networks Italy. "In the coming months, we plan to develop centers dedicated to Omnitel Vodafone that will work tightly with our Research and Development center opened last year in Palermo.

Nortel Networks has previously announced UMTS awards from BT Cellnet and One 2 One in the UK, Airtel and Xfera in Spain, T-Mobile in Germany, max mobile in Austria, and AT&T Wireless in the United States.

Nortel Networks solutions are unleashing the potential of the high-performance Wireless Internet. These solutions are driven by Nortel Networks 'Wings of Light' strategy, which combines optical, wireless and IP (Internet Protocol) to help operators provide highly reliable, high-speed access to broadband Internet services virtually 'anytime, anywhere.'

Nortel Networks UMTS solutions include: Nortel Networks e-mobility Internet base transceiver stations (BTS) for wide area radio coverage; packet-based core networks featuring Nortel Networks Passport multiservice switches; Nortel Networks Preside services management; Nortel Networks Shasta 5000 Broadband Service Node (BSN); and Nortel Networks Alteon Web switching.

UMTS is designed to provide high-speed access to information, e-mail, real-time video and other Wireless Internet services through a variety of personal, portable devices.

Omnitel Vodafone is a private wireless operator and has been offering services to the Italian market since 1995. In the year 2000, Omnitel became part of Vodafone, the largest wireless telecom group in the world. Omnitel Vodafone has approximately 16 million customers, 8 operative call centers and more than 2000 point of sales contacts. Omnitel Vodafone covers 97% of Italy and reaches over 99% of the Italian population and has international roaming in 81 countries worldwide. Visit us at www.omnitel.it

Nortel Networks is a global Internet and communications leader with capabilities spanning Optical, Wireless, Local, Personal Internet and eBusiness. The Company had 2000 U.S. GAAP revenues of US$30.3 billion and serves carrier, service provider and enterprise customers globally. Today, Nortel Networks is creating a high-performance Internet that is more reliable and faster than ever before. It is redefining the economics and quality of networking and the Internet, promising a new era of collaboration, communications and commerce. Visit us 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 impact of price and product competition; the dependence on new product development; the impact of rapid technological and market change; the ability of Nortel Networks to make acquisitions and/or integrate the operations and technologies of acquired businesses in an effective manner; general industry and market conditions and growth rates; international growth and global economic conditions, particularly in emerging markets and including interest rate and currency exchange rate fluctuations; the impact of consolidations in the telecommunications industry, the uncertainties of the Internet; stock market volatility; the ability of Nortel Networks to recruit and retain qualified employees; the ability to obtain timely, adequate and reasonably priced component parts from suppliers and internal manufacturing capacity; the impact of the credit risks of our customers; the entrance by Nortel Networks into an increased number of supply, turnkey, and outsourcing contracts which contain delivery, installation, and performance provisions, which, if not met, could result in Nortel Networks having to pay substantial penalties or liquidated damages; and the impact of increased provision of customer financing and commitments by Nortel Networks. 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. 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.

Nortel Networks, the Nortel Networks logo, the Globemark, e-mobility, Passport, Preside, Shasta and Alteon are trademarks of Nortel Networks. cdmaOne is a trademark of the CDMA Development Group.