OneConnect Selects Nortel Networks to Accelerate Delivery of Advanced Multimedia Services to Business Customers Across Canada.

Business Editors/High-Tech Writers

TORONTO--(BUSINESS WIRE)--March 29, 2004

Multimedia Communications Solutions Expected to Enable New Revenue

Opportunities, Reduce Costs

OneConnect, an independent voice over Internet Protocol (VoIP) communications company based in Toronto, is working with Nortel Networks (NYSE:NT)(TSX:NT) to deliver a comprehensive suite of advanced, Session Initiation Protocol (SIP)-based multimedia services like video calling and find me/follow me to Canadian businesses.

OneConnect plans to invest US$20 million in Nortel Networks technology and professional services to launch hosted IP multimedia applications and services that simplify customer communications, improve mobility and increase productivity. OneConnect estimates that businesses can expect savings of 15 to 30 percent on telephony and Internet connectivity costs by using the OneConnect service.

"The OneConnect vision is to enable businesses and their employees to seamlessly interact with clients and colleagues on any device or network, whether at home, in the office, or on the road," said Ron Dekker, president and chief executive officer, OneConnect. "We need a multimedia communications solution that will enable us to execute on this vision and drive revenue growth, and Nortel Networks multimedia communications portfolio offers us a robust, carrier grade solution that is virtually unmatched in the industry. Backed by Nortel Networks strong technology heritage, OneConnect's advanced multimedia service offerings will significantly enhance the efficiency, productivity and mobility of our customers' business."

Using Nortel Networks Multimedia Communication Server (MCS) 5200, OneConnect will offer business customers carrier-class communications solutions via an easy-to-use, hosted multimedia service. OneConnect will provide businesses with IP voice, video, call management, collaboration and conferencing services in a single, converged solution.

"Nortel Networks is fundamentally changing interpersonal communications by enabling new integrated voice, video and data services that will ultimately enhance how, when and where people communicate," said Sue Spradley, president, Wireline Networks, Nortel Networks. "Service providers worldwide have endorsed Nortel Networks multimedia communications solutions, and this win with OneConnect is yet another example of how we are empowering our customers to drive new revenue opportunities and facilitate mass market deployment of new, hosted multimedia services. OneConnect is establishing itself as an innovator in this market, and we are proud that they have selected Nortel Networks voice over IP and multimedia solutions to pave the way to new market opportunities."

OneConnect, which has already launched commercial service, will initially focus on Toronto and Montreal, where 60 percent of Canadian businesses -- representing CDN$2 billion (US$1.5 billion) of the Canadian telephony market -- are located.

With deployment of this new IP-based network, OneConnect customers will be able to enjoy the benefits of traditional telephony features and services as well as:

-- Video Calling -- video communications without special rooms,

complicated dialing plans or expensive equipment

-- Find Me/Follow Me -- maximum flexibility to answer calls

anytime and anywhere

-- Meet-me Conferencing -- instantly initiate a video or voice

conference without pre-arranged conferencing facilities

-- Personal and Group Directories -- simple access to information

for personal and business contacts

-- Whiteboarding/Co-browsing and Web Push Services -- use

multiple tools during a session to enhance the communication

and collaboration between individuals, regardless of location

Nortel Networks multimedia solutions allow OneConnect to provide customers with a flexible migration path to VoIP without abandoning existing infrastructure. Customers who have an existing PBX or key system can take advantage of all the benefits of multimedia services offered by OneConnect without replacing their current system.

As part of this network deployment, OneConnect plans to use Nortel Networks Shasta 5000 Broadband Services Node (BSN) for centralized subscriber aggregation and management and IP services like firewalling, IP virtual private networks (IP VPNs), NAT, filtering and quality of service (QOS) to provide reliable, high fidelity voice and multimedia services that surpass industry-leading security and performance levels.

Nortel Networks Shasta 5000 BSN is designed to enable service providers to aggregate up to 32,000 subscribers -- via cable, DSL, private line, dial-up, wireless or any other access medium -- onto a single platform. Shasta 5000 BSN also enables network-based, value-added IP services like firewalls, VPNs, the ability to individually allocate Internet access bandwidth, and other personalized services.

Nortel Networks MCS 5200, part of Nortel Networks Multimedia Communications Portfolio, is a carrier-grade, SIP-based media and applications server. The Multimedia Communications Portfolio, including both MCS 5200 and MCS 5100, delivers advanced multimedia and collaborative applications through the same commercially available hardware and open-standards software. This portfolio delivers the scale and functionality necessary for both enterprises and service providers to address their target markets. It transforms the way users communicate by enabling next generation tools that improve productivity and facilitate ubiquitous access to communications services.

For the entire year and fourth quarter of 2003, Nortel Networks ranked #1 in the global markets for voice over IP ports shipped and in global softswitch revenue, according to Synergy Research Group and In-Stat/MDR. Nortel Networks has a proven portfolio of products and services for packet voice and multimedia services. Nortel Networks is providing Succession VoIP solutions to leading operators, including Verizon Communications, Bell Canada, Charter Communications, Sprint, MCI, Cox Communications, Cable & Wireless Cayman Islands, Hong Kong Broadband Network, China Netcom and China Railcom.

OneConnect provides breakthrough hosted and managed IP Communications services for businesses in Canada. OneConnect is focused on providing market leading services that deliver the power and flexibility of IP Multimedia (voice, data and video) tools affordably, simply and easily to business users. OneConnect is currently offering service to businesses in Toronto and Montreal. OneConnect is a subsidiary of Globalive Communications -- the fastest growing global provider of niche telecom solutions in Canada. On an operating basis, Globalive provides OneConnect with network infrastructure and operating, customer and billing support systems. Please visit www.oneconnect.ca.

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 outcome of Nortel Networks independent review and any further restatement of its previously announced or filed financial results; the impact of the inability to meet Nortel Networks filing obligations on credit and support facilities and public debt obligations; the sufficiency of Nortel Networks 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; continued reductions in spending by Nortel Networks customers; fluctuations in Nortel Networks operating results and general industry, economic and market conditions and growth rates; the communication by Nortel Networks auditors of the existence of material weaknesses in internal control; Nortel Networks ability to recruit and retain qualified employees; fluctuations in Nortel Networks cash flow, level of outstanding debt and current debt ratings; Nortel Networks ability to meet the financial covenant in its credit facilities; the use of cash collateral to support Nortel Networks normal course business activities; the dependence on Nortel Networks subsidiaries for funding; the impact of Nortel Networks defined benefit plans and deferred tax assets on results of operations, Nortel Networks cash flows and compliance with its financial covenant; Nortel Networks dependence on new product development and its ability to predict market demand for particular products; Nortel Networks 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 in the telecommunications industry; changes in regulation of the Internet; the impact of the credit risks of Nortel Networks customers and the impact of customer financing and commitments; stock market volatility generally and as a result of acceleration of the settlement date or early settlement of our purchase contracts; risks associated with a consolidation of Nortel Networks common shares; the impact of Nortel Networks 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; the future success of Nortel Networks strategic alliances; and the adverse resolution of litigation, intellectual property disputes and similar matters. For additional information with respect to certain of these and other factors, see the most recent Form 10-Q/A and Form 10-K/A 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.

Nortel Networks, the Nortel Networks logo, the Globemark, Business Without Boundaries and Shasta are trademarks of Nortel Networks.