Patriot Media Launches Digital Phone Service Using Nortel Cable VoIP Solution; Nortel Global Services Speed Deployment, Time to New Revenue Opportunities.

SOMERSET, N.J. -- Patriot Media has deployed cable VoIP technology from Nortel (NYSE:NT)(TSX:NT) to offer Patriot's Digital Phone service to more than 115,000 homes in central New Jersey. The initial deployment was accomplished in one month from shipment to in-service with the aid of Nortel Global Services.

"Adding voice capability to the Patriot Media network was a significant and critical step for us, and we presented Nortel with an extremely aggressive deployment schedule," said Jim Holanda, president and general manger, Patriot Media. "To successfully meet each of our deadlines, Nortel brought together an exceptional team of services engineers with a robust cable VoIP solution to ensure Patriot Media's Digital Phone service delivers the highest standards of quality and reliability for our customers."

Nortel Global Services provided to Patriot Media under an equipment and services agreement include consulting to minimize capital, operating and engineering costs while maximizing network and service performance. Patriot Media will continue to use Nortel Global Services to lead planning, program management, multi-vendor integration, interoperability testing and on-going deployment of its VoIP solution to promote smooth end-to-end network implementation.

Built on Nortel's PacketCable-qualified Communication Server (CS) 2000-Compact softswitches, Patriot Media's Digital Phone service uses a Quality of Service (QOS) standard designed to ensure that voice calls are not affected by other Internet applications that may be running simultaneously. A constant information stream is expected to provide high levels of voice quality and eliminates echoes in the line and voice break-up.

"The SIP functionality of Nortel's softswitch allows us to efficiently connect to other telephony networks, and to pave the way for future SIP-enabled opportunities such as telephone caller ID and other features through the television display in one integrated experience," Holanda said.

Nortel provided Patriot Media with IP Unity's Mereon(TM) 6000 Media Server and Mereon Unified Messaging application to offer customers enhanced voice mail service. Enhanced voice mail provides all of the features of a traditional answering machine with added convenience and flexibility, such as the ability to manage and access messages from anywhere in the world via telephone or the Internet.

"As the competition heats up to capture more subscribers and keep pace with new technologies, cable customers like Patriot Media continue to look at VoIP technologies to give subscribers the best of the Internet with the best of today's telephone network," said Dan Mondor, general manager, Cable Network Solutions, Nortel. "One of Nortel's key strategies in making this possible is integrating products from companies like IP Unity into our service offerings to give providers a complete cable telephony solution that is designed to address their current needs and grow with their businesses."

Nortel ranked number one in the global markets for service provider softswitches and gateways for the first half of 2005 and the entire year of 2004, according to Synergy Research Group. Nortel's cable solutions have been selected by leading operators around the world, including Cox Communications, Rogers Cable, Adelphia Communications, Charter Communications, Shaw Cablesystems, Cable One, ish, Kabel BW, TeleCable, Telenet, Dacom, Gansu, Cable Onda, and Intercable.

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 ongoing 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); 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; general stock market volatility; 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; any undetected product defects, errors or failures; the future success of Nortel's strategic alliances; and certain restrictions on how Nortel and its president and chief executive officer conduct business.

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. PacketCable is a trademark of Cable Television Laboratories, Inc. (CableLabs). Mereon is a trademark of IP Unity.