Nortel Networks to Provide Metro DWDM Solution for PLDT Network Optimization; Will Enhance Competitive Advantage, Profit Potential for PLDT.

Business Editors & High Tech Writers

MANILA, Philippines--(BUSINESS WIRE)--Sept. 20, 2001

In a strategic move to optimize its existing Manila fiber optic tandem trunking transmission network, Philippines Long Distance Telephone Company (PLDT) (NYSE:PHI) (PSE:TEL) plans to deploy a high-performance, DWDM (dense wavelength division multiplexing) metropolitan optical solution from Nortel Networks (NYSE:NT) (TSE:NT.).

As part of this major upgrade, PLDT also plans to establish a central tandem office in the municipality of Pasig for high-speed interconnection to all metro switching centers, and add transmission capacity to local exchanges in Pasig, Garnet and Makati.

At the core of the PLDT solution is Nortel Networks OPTera Metro 5200 Optical Line System. DWDM data-optimized to leverage investments in existing fiber infrastructure, OPTera Metro 5200 is protocol and bit-rate independent. It offers a survivable platform for metro access and inter-exchange applications and flexible connectivity over point-to-point or ring-based networks, helping service providers like PLDT address unpredictable bandwidth growth, capitalize on service delivery opportunities, and enhance profit potential.

"Growing use of the Internet and a significant rise in increasingly sophisticated and bandwidth-hungry applications are driving the decision to streamline our network," said George N. Lim, senior vice president, Network Development and Provisioning, PLDT. "Nortel Networks OPTera Metro solution will cost-effectively enable us to remove Manila bottlenecks, increase connectivity speeds and, most importantly, drive dramatically improved service reliability for our customers."

"OPTera Metro will position PLDT to provide high-speed connectivity between exchanges, and to offer enterprise customers managed optical services, storage networking solutions, and managed wavelength services," said Antonio Pio De Roda, managing director for Nortel Networks in the Philippines. "This will help PLDT to enhance competitive advantage in the dynamic Manila market by providing service differentiation, and by responding to customer demand through flexible and scalable optical transport solutions."

OPTera Metro 5200 is part of Nortel Networks complete, flexible and industry-leading Optical Metro portfolio of DWDM, next-generation SONET, and Optical Ethernet products, currently deployed in over 1,000 customer networks in 45 countries. Nortel Networks was No.1 position in the growing metro DWDM market for the second quarter of 2001, according to the Dell 'Oro Group.

This is the second major expansion contract PLDT has awarded to Nortel Networks in less than a year. In December 2000, Nortel Networks announced its selection by PLDT to supply a full suite of Optical Internet solutions -- including a 10-gigabit DWDM solution based on Nortel Networks OPTera Long Haul 1600 Optical Line System -- to expand PLDT's Domestic Fiber Optic Network (DFON) and create a scalable platform for delivery of fast, reliable and competitive broadband, data and IP services.

PLDT is the leading supplier of domestic and international telecommunications services in the Philippines. Listed on the Philippine Stock Exchange (PSE:TEL) and with ADRs listed on the New York Stock Exchange (NYSE:PHI) and the Pacific Exchange, Manila-based PLDT is actively pursuing a convergence strategy through its three principal business groups -- fixed line, wireless and ePLDT. These businesses provide a comprehensive menu of products and services for over 7.3 million subscribers across the most extensive broadband and integrated networks in the country.

Nortel Networks is a global leader in networking and communications solutions and infrastructure for service providers and corporations. The Company is at the forefront of transforming how the world communicates, exchanges information and profits from the high-performance Internet through capabilities spanning the Optical Internet, Wireless Internet, Intelligent Internet and IP (Internet Protocol) technologies and services. Nortel Networks does business in more than 150 countries and 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 including at the most senior management levels; 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 Corporation and Nortel Networks Limited with the United States Securities and Exchange Commission. Unless otherwise required by applicable securities laws, Nortel Networks Corporation and Nortel Networks Limited disclaim 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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