Bell Mobility, Nortel to Deliver Canada's Fastest, Most Advanced Wireless Data Network; Contract Extension Supports CDMA2000 1X Network Expansion, 1xEV-DO Deployment.

TORONTO -- Bell Mobility, Canada's leading wireless carrier, has signed an estimated US$126 million (C$160 million) multi-year contract with Nortel (NYSE:NT) (TSX:NT) for equipment to enable the country's fastest and most advanced wireless data network, which is expected to deliver services at speeds up to six times faster than what is currently available.

The network, to be powered by Nortel's CDMA2000 1X and 1xEV-DO (Evolution-Data Optimized) third generation (3G) wireless technology, will help enhance the user experience by enabling such services as video mail and messaging, wireless gaming and content streaming at speeds close to high-speed wireline connections.

"Nortel is making it possible for us to deliver on our commitment to offer subscribers the latest and most advanced wireless services available today," said Almis Ledas, vice president, corporate development, Bell Mobility, a wholly owned division of Bell Canada. "The EVDO network will offer Canada's fastest wireless experience and deliver leading-edge innovation to the market to revolutionize the way Canadians use their mobile devices."

With what is expected to be the first commercial deployment in Canada of a next generation wireless data network using EV-DO technology, Bell Mobility customers will be able to download data on their mobile devices at speeds up to 2.4 megabits per second with average speeds of 300-500 kilobits per second. Bell Mobility announced its intention to build the EV-DO network in December 2004, and the company plans to offer initial EV-DO services in select markets in 2005.

"We've seen how EV-DO can greatly enhance the end user experience through our work in the United States and across the globe, and we look forward to bringing this technology to Canadian businesses and consumers with Bell Mobility, Canada's most innovative wireless operator," said Richard Lowe, president, CDMA, Nortel. "This agreement with Bell Mobility demonstrates our continued leadership in delivering advanced and innovative wireless data solutions to operators around the world."

Nortel supplies EV-DO equipment to 12 of the 19 operators across the globe who currently offer commercial EV-DO service. Nortel provided the equipment to the first operators to launch commercial EV-DO services in South America (Vesper), Central America (BSI Guatemala), and Australia (Telstra). Nortel also provided EV-DO equipment to Eurotel for the first commercial 450 MHz EV-DO service in Eastern Europe.

Under the new agreement with Bell Mobility, Nortel will provide CDMA2000 1X radio base stations, base station controllers, switching platforms and other related equipment. Nortel will also supply Bell Mobility with CDMA2000 1xEV-DO equipment for initial deployment in Toronto and Montreal.

Nortel CDMA equipment is designed to support EV-DO through simple upgrades to existing hardware, which simplifies Bell Mobility's migration from 1X to EV-DO. This approach provides a cost effective and rapid method for enhancing the end user experience by delivering advanced wireless services and applications.

Nortel has designed, installed and launched more than 300 wireless networks in over 70 countries. Nortel was the first supplier with wireless networks operating in all advanced radio technologies and is the only end-to-end provider of all next generation wireless solutions.

About Bell Canada

Bell Canada, Canada's national leader in communications, provides connectivity to residential and business customers through wired and wireless voice and data communications, local and long distance phone services, high speed and wireless Internet access, IP-broadband services, e-business solutions and satellite television services. Bell Canada is wholly owned by BCE Inc. For more information, please visit www.bell.ca.

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. CDMA2000 is a trademark of the Telecommunications Industry Association (TIA).