Nortel Networks Adaptive Campus LAN to Enable Enterprise Multimedia Collaboration.

Business Editors/High-Tech Writers

SANTA CLARA, Calif.--(BUSINESS WIRE)--June 24, 2003

Second Phase of Advanced Business Connectivity Designed to

Eliminate Network Boundaries

Nortel Networks (NYSE:NT) (TSX:NT) has introduced an adaptive campus local area network (LAN) designed to eliminate enterprise network boundaries, and to lay a foundation for new collaborative multimedia applications.

As the second phase of Nortel Networks Advanced Business Connectivity initiative announced in February 2003, the adaptive campus LAN will be supported by two new products - Nortel Networks BayStack 5000 series switches and Nortel Networks Passport 8300 Ethernet Switch.

By providing authorized users with unfettered access to information, resources and applications, Nortel Networks adaptive campus LAN is intended to help position businesses to drive improved efficiency and responsiveness. It will also help them to protect existing infrastructure investments by optimizing the network edge to accommodate increased collaborative applications, and by enabling evolution of the network core as required.

"Creating a single, converged network that provides voice, data and multimedia communications is a critical enabler for businesses to become engaged with their customers and stakeholders," said Oscar Rodriguez, president, Enterprise Solutions, Nortel Networks.

"The adaptive campus LAN will take the benefits of the converged architecture to the next level, providing the means for end-users to share collaborative applications in a decentralized manner over a more responsive infrastructure." Rodriguez said. "This approach will enable users to share applications instantly as the network dynamically adapts to application requirements."

Part of Nortel Networks 'One network. A world of choice.' enterprise vision, the Advanced Business Connectivity adaptive campus LAN represents the next evolution in networking - a flexible architecture to provide network services and applications that enable the network to support distributed applications as needed. It will enable a new way of networking that is responsive, manageable, and cost efficient.

"Indeed, we are seeing stronger sales of devices that have more intelligence at the edge of the LAN," said Joshua Johnson, industry analyst at Synergy Research Group, a research firm that tracks communications equipment for emerging markets.

"Additionally, Enterprises are adopting new software applications that facilitate communication and productivity, and as such are of increasing importance to the business," Johnson said. "This trend places more demands on the LAN infrastructure to be consistent and continuous.

Customers will need more resilience and the increased performance at the network edge that Nortel Networks is delivering with both BayStack 5000 and Passport 8300 products."

Trends related to the increase in collaborative, distributed applications are driving the need for networks to be increasingly adaptive and flexible. These trends are predicated on delivering new, collaborative capabilities to state-of-the-art networking, requiring greater traffic management capabilities at the network edge.

Collaborative technologies such as Instant Messaging, workspace document sharing, and Extensible Markup Language (XML)-based applications are increasing the agility of employees by allowing them to collaborate in real time. Internet Protocol (IP) telephony provides connectivity with all the features of public-switched telephony and cost savings. At the same time, advances in network computing enable the intelligence that traditionally resided in the data center to be pushed out to the periphery of the network.

To meet the requirements of enterprises implementing an adaptive network, Nortel Networks has introduced significant enhancements to the BayStack and Passport product portfolios. The new BayStack 5000 switches will have greater intelligence, resilience and performance to accommodate distributed applications. Providing Gigabit Ethernet connectivity to the desktop, the BayStack 5000 series will improve stacking performance with nearly 32 times the throughput of its predecessor.

BayStack 5000 will provide integrated stacking, Quality of Service (QoS) and cutting-edge security features. It will also support Split Multi Link Trunking to provide sub-second network recovery in the event of failure.

The BayStack 5000 series will include two models - BayStack 5510-48T with 48 ports, and BayStack 5510-24T with 24 ports. Both will provide Ethernet, Fast Ethernet and Gigabit connectivity. In addition to greater traffic management capabilities enabled with Layer 3 routing, the switch will be able to find the quickest data path to end-users, making collaboration faster and more effective. New capabilities from the Flexible Advanced Stacking Technology or 'FAST Stack,' design will automatically redirect all traffic around any box within a stack that is not performing properly.

The new Passport 8300 Ethernet Switch is a modular Layer 3 routing switch that will offer power over Ethernet. It is designed to bring performance, resilience, security and intelligence to the enterprise wiring closet. Offering high-density Ethernet, Fast Ethernet and Gigabit connectivity as well as QoS and sophisticated management features, the switch also will offer software functionality and modules that can be upgraded. Passport 8300 is built for resilience, offering 'hot swappable' components, redundant switch fabrics, power supplies, Split Multi Link Trunking, and a common operating system with Passport 8600 and 8100 series routing switches.

'One network. A world of choice.' is about raising the bar with a new level of customer and employee engagement where and how the network is accessed while offering enterprises the power of choice in deployment options through leading solutions in IP Telephony, applications, data and optical networking.

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.

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 meet financial covenants contained in our credit agreements; 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 customer financing and commitments; stock market volatility; the entrance into an increased number of supply and outsourcing contracts which contain delivery and installation 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.

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