French Railway Manager RFF Selects Nortel Networks for Nationwide GSM-R Network.

Business Editors/High-Tech Writers

PARIS--(BUSINESS WIRE)--Sept. 23, 2003

French railway infrastructure manager RFF (Reseau Ferre de France) and the French railway operator SNCF (Societe Nationale des Chemins de fer Francais) have selected Nortel Networks (NYSE:NT)(TSX:NT) to provision a France-wide GSM-R (Global System for Mobile Communication-Railway) network under a 15-year agreement signed by RFF and estimated to be worth US$200 million.

The new GSM-R system will handle all voice and data communications for operation of trains within 15,000 kilometres of track as a replacement for the existing analog radio system. The project will be underway by mid-2004 on the new Eastern France High Speed Line (first phase of the future Paris-Strasbourg high speed line). Service to railway operators is expected to be delivered on the first commercial lines by end of 2005.

"The deployment of GSM-R is a key element to upgrading the French railway infrastructure and to its interoperability with other European networks," says Jean-Michel Richard, director of RFF railway infrastructure. "Choosing Nortel Networks GSM-R technology demonstrates the lasting quality of this system which is derived from the public mobile infrastructure GSM."

"With this new agreement, the industry's second largest GSM-R award announced to date, Nortel Networks continues to demonstrate its strong technological and market position in GSM-R," said Vivian Hudson, president and general manager, GSM/GPRS/EDGE, Nortel Networks. "When completed, this project will bring the total length of track we have deployed using GSM-R technology to 43,000 kilometres, more than any other vendor in the world."

Nortel Networks GSM-R infrastructure provides features and telematics applications to enable railway operators to enhance emergency procedures, improve the operational efficiency and safety of existing transport systems and reduce the overall cost of operations. Network performance is also improved with GSM-R, bringing enhanced Quality of Service and reliability and providing clear voice and data communications to high-speed trains travelling up to 300 kilometres per hour.

GSM-R is a cost effective, professional, radio-communications system that uses standard GSM technology with additional features customized for railway operations. GPRS (General Packet Radio Service) is a major part of GSM-R for data transport supporting applications and making the infrastructure both 'future proof' and compliant with GSM-R standards. It is also oriented toward new, location-specific services and applications like wireless local area networks (WLAN). A common frequency range is used in all GSM-R networks to achieve international interoperability and spectrum efficiency.

Leveraging more than 10 years experience in GSM-R technology, Nortel Networks will now be supplying GSM-R in a number of countries, including France, Germany, the UK, Italy and Slovakia. Nortel Networks provided the GSM-R end-to-end system of the new German ICE high-speed line in commercial operation between Frankfurt and Cologne, as well as the high-speed line between Rome and Naples.

Nortel Networks has been a pioneer in the GSM-R standards process since 1992, and continues to work with UIC (Union Internationale des Chemins de Fer) and ETSI (European Telecommunications Standards Institute). Nortel Networks supplied the equipment for the MORANE (Mobile Radio for Railways Networks in Europe) trial, working with SNCF since the beginning of 1996, and was a major contributor to the EIRENE (European Integrated Railway radio Enhanced Network) GSM-R standard.

The French Railway infrastructure (RFF) is a French industrial and commercial state institution, created for the renewal of the French railway transportation system by a February 13, 1997 law. Its mission is to ensure the "layout, development, coherence and enhancement of France's national railway infrastructure," which it owns.

RFF is responsible for the maintenance of this infrastructure, which the SNCF looks after on its behalf, along with the overall infrastructure operability and traffic management. Moreover, the RFF is in charge of laying-out and developing the infrastructure through investments to the national railway network. More information on RFF can be found on the Web at: www.rff.fr.

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 Wireless Networks, Wireline Networks, Enterprise Networks, and Optical 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.

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