Spanish Cable Operator Deploys Routing Switches, Optical Equipment from Nortel Networks.

Business Editors/High-Tech Writers

MADRID, Spain--(BUSINESS WIRE)--Jan. 16, 2003

Retecal, the cable telecom operator in Spain's Castilla-Leon region, has upgraded its data network to an open Internet Protocol (IP)-based system and increased its overall dense wavelength division multiplexing (DWDM) infrastructure capacity by deploying routing switches and optical equipment from Nortel Networks (NYSE:NT)(TSX:NT).

Nortel Networks solution for Retecal includes an IP backbone network based on Nortel Networks Passport 8600 Routing Switches. This network was designed to satisfy Retecal's requirements for network reliability and scalability for a range of multimedia applications.

Retecal is using the content intelligent capabilities of Nortel Networks Alteon Layer 4-7 Web Switching Module, integrated with Passport 8600, to accelerate Internet content access. Retecal is also using Alteon Content Cache to improve content delivery on the information most frequently requested by end-users, which reduces traffic by off-loading repetitive tasks from servers.

Retecal has also deployed Nortel Networks OPTera Long Haul 1600 Optical Line System, an optical platform using DWDM, to maximize the capacity available in each fiber -- up to 320 Gigabits per second per pair. This allows Retecal to implement virtual transport infrastructures for third-party carriers. OPTera Long Haul 1600 offers service transparency and the ability to add various channels, such as 2.5 Gigabit per second streams, Gigabit Ethernet or 10 Gigabit Ethernet, as well as standard 10 Gigabit per second SDH wavelengths.

The new network positions Retecal to improve the Internet experience for its customers, both residential and corporate, and to extend its portfolio with new products and innovative services including Virtual Private Networks (VPNs), Ethernet access networks, voice over IP, and advanced multimedia services with a focus on increased productivity and efficiency.

"We have designed a new network infrastructure, based on Nortel Networks solutions, making Retecal one of the most technological advanced companies in the region," said Juan Garcia Conde, chief executive officer, Retecal. "Nortel Networks is our technological reference."

"Nortel Networks is committed to work with customers like Retecal to design and deploy technologically advanced solutions that will position them to drive reduced operating and capital expenses," said Jordi Casamitjana, vice president and managing director, Nortel Networks Iberia.

Nortel Networks provides a comprehensive, integrated cable solution spanning Optical Ethernet, long haul and metro optical, telephony, IP and voice over IP. Nortel Networks is committed to delivering a portfolio based on industry standards to reduce interoperability costs and speed deployment. Today, Nortel Networks equipment is providing service to more than four million cable telephony lines globally.

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 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 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, Passport, Alteon and OPTera are trademarks of Nortel Networks.