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March 12, 2002
Telefónica Móviles Selects Nortel Networks for German, Spanish UMTS Networks
MADRID, Spain – Telefónica Móviles SA, one of the world's largest wireless operators, has selected Nortel Networks* [NYSE/TSE: NT] to supply radio access equipment for build out of its third generation (3G) Universal Mobile Telecommunications System (UMTS) networks in Spain and Germany.
The combined award, which is subject to execution of definitive agreements, is estimated to be worth approximately US$250 million (Euro 285 million) over three years, with network rollout scheduled to commence in the second half of 2002. Nortel Networks expects to provide financing up to approximately US$230 million (Euro 260 million) in connection with the award. This award will further strengthen Nortel Networks global leadership position in wireless networks. Nortel Networks is also a leading provider of 3G networks in Europe, and particularly in Iberia, the first region in Europe expected to implement live 3G networks. Nortel Networks has announced six UMTS awards in Iberia. Nortel Networks expects to provide Telefonica Moviles with radio infrastructure equipment in Spain, including Nortel Networks Internet Base Transceiver Station (BTS), and a full turnkey UTRAN (radio access) solution in Germany encompassing site acquisition, installation, commissioning, engineering and provisioning for more than 1,000 base stations. "The continued success of Nortel Networks in securing these vital UMTS awards follows the recent [US]$500 million award from Cingular Wireless and further demonstrates our leadership position in supplying next generation wireless networks," said Pascal Debon, president, Wireless Networks, Nortel Networks. "We will work closely with Telefonica Moviles to ensure they benefit from our in-depth global experience in deploying and optimizing large networks based on code division technology." Nortel Networks has already supplied Telefónica Móviles España with a nationwide ATM packet network to enable transition from traditional, circuit-based switching to state-of-the-art, packet-based switching, a key technology for supporting GPRS, third generation UMTS, and Wireless Internet services. Telefonica Moviles operates in Germany through its subsidiary, QUAM. 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. *Nortel Networks, the Nortel Networks logo and the Globemark are trademarks of Nortel Networks. Contact for Press and Analysts:Will Cairns
Nortel Networks
44 1628 438031
wcairns@nortel.com
Tina Warren
Nortel Networks
905 863 4702
tinawarr@nortel.com
Claire Cranton
Nortel Networks
44 1628 617178
cranton@nortel.com
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