AirTouch Cellular to Purchase Network Infrastructure From Nortel Networks; Los Angeles Market Readies for 21st Century.

LOS ANGELES--(BUSINESS WIRE)--Nov. 6, 1998--AirTouch Cellular (NYSE:ATI) today announced that it has signed a letter of intent with Nortel Networks (NYSE:NT)(TSE:NTL) for the multi-year purchase of state-of the-art network switches, base stations and controllers. AirTouch expects to lower costs, meet future demands of wireless customers and achieve a better balance among its mix of infrastructure suppliers.

Under the terms of the letter of intent, AirTouch will purchase analog and cdmaOne (IS-95 CDMA) digital network infrastructure for its Los Angeles market. This expansion is consistent with AirTouch's plans and is not expected to affect the company's planned 1998 or 1999 financial results, including total capital expenditures.

"When we went out to bid for equipment for our expansion into the Southern California desert area, Nortel Networks made us a very compelling offer to supply new equipment for all of Los Angeles," explained Nancy Hobbs, executive vice president and general manager with AirTouch Cellular. "We like the Nortel Networks solution today, and we share their vision of the future. Their bid gave us an opportunity to upgrade our network to meet customer needs for the next century, and to reduce costs over time."

"By furthering our multi-vendor strategy, we've introduced more supplier competition for our business and driven network costs lower," said Hobbs.

The Nortel Networks equipment provides a dual-mode network environment that handles both analog and digital calls. The transition in Los Angeles is expected to be transparent to customers.

"We believe the performance of our CDMA portfolio, our track record with large digital network rollouts and our Unified Networks vision of future, IP-based networks and services were instrumental in this award," said Matt Desch, president, Wireless, Nortel Networks.

"Nortel Networks and AirTouch have enjoyed a satisfying and mutually beneficial working relationship for years, including most recently our CDMA digital rollouts in Detroit and the Great Lakes region last year," said Desch. "We look forward to building on that success in Los Angeles."

Following the Los Angeles deal, Nortel Networks will supply about 40 percent of the network infrastructure for AirTouch's U.S. cellular markets.

As part of its multi-vendor strategy, AirTouch remains committed to Motorola which still provides hundreds of millions of dollars in equipment for about 40 percent of AirTouch's cellular networks in the United States. "We have a solid relationship with Motorola and will continue to rely on their products to support other cellular networks as well as our paging and handset needs," said Mike Polosky, executive vice president, network systems at AirTouch.

Lucent and Ericsson supply the remaining 20 percent of network infrastructure for AirTouch's U.S. Cellular markets.

AirTouch serves over 7 million U.S. cellular customers and operates in 22 of the top 30 U.S. markets, including Los Angeles, San Francisco, San Diego, Atlanta, Detroit, Cleveland, San Jose, Sacramento, Cincinnati, Kansas City, Seattle, Portland (Oregon), Denver, Phoenix, and Minneapolis.

AirTouch Communications is the largest wireless company in the world. AirTouch owns interests in cellular, paging, and personal communications services in the United States and 12 other nations as well as an interest in the Globalstar satellite system. Based on its ownership share of its global ventures, the company serves over 16 million proportionate customers (over 35 million total venture customers).

Nortel Networks' common shares are listed on the New York, Toronto, Montreal, Vancouver and London stock exchanges. Nortel Networks had 1997 revenues of US$15.5 billion and Bay Networks, a wholly owned subsidiary of Nortel Networks, had revenues of US$2.4 billion during its most recent fiscal year. The combined company's workforce totals approximately 80,000 employees worldwide.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Except for the historical information presented, the matters discussed in this release are forward-looking statements and are subject to risks and uncertainties that could cause actual results to differ materially. Such factors include: a change in economic conditions in the various markets served by the Company's operations which would adversely affect the level of demand for wireless services; intensified competitive activity requiring reduced pricing and/or new product offerings or resulting in an increased rate of customers terminating service (churn), slower customer growth as customers choose to receive service from other providers, and higher customer selling costs; declining average revenue per customer due to an increasing proportion of consumer customers and declining rates; growth in customers and usage driving increased investment in network capacity; the level of fraudulent activity; the impact of new business opportunities requiring significant up-front investments; the impact on capital spending from the deployment of new technologies; the possibility that technologies will not perform according to expectations or that vendor performance will not meet requirements; and higher than anticipated costs associated with correcting the Year 2000 problem. These and other factors related to the business are described in the Company's SEC filings, including in its 10-K under "Investment Considerations" and the quarterly reports on Form 10-Q.

For a fax copy of this or other AirTouch press releases, please call 1-800/344-7531 or visit the AirTouch web site at www.airtouch.com.