Johnson Controls Renews Global Managed Telephony Services Agreement wi

    Business Editors/Automotive Writers/Technology Editors

    SANTA CLARA, Calif.--(BUSINESS WIRE)--Jan. 31, 2005--Johnson Controls, Inc. (NYSE:JCI), a leading manufacturer of automotive systems and building controls, has signed an agreement to extend and expand its Global Managed Network Services relationship with Nortel (NYSE:NT) (TSX:NT) for six years through 2010.
    The Nortel services solution positions Johnson Controls to realize operational savings and enhanced network reliability and performance. This allows Johnson Controls to focus on its core business.
    Under the agreement, Nortel will continue to provide comprehensive, around-the-clock network management, project management and professional services for Johnson Controls' global network, which supports its workforce across several hundred sites in the Americas and Europe. This network is powered by a full suite of Nortel voice and security solutions encompassing its PBX and call center environment.
    The network outsourcing relationship with Nortel covers virtually all of Johnson Controls' needs -- from dial-tone and voice mail management to call center networking -- and includes the management of third-party systems. This relationship began in 2000, when Johnson Controls selected Nortel to manage the real-time networking and communications service requirements of its workforce.
    "Nortel offers a powerful network management outsourcing solution that continues to bring us operational savings, productivity gains and industry-leading solutions," said Mark Schoeppel, vice president, Global Infrastructure, Johnson Controls. "Equally important to Johnson Controls are Nortel's overall operations management methodology and proven ability to support a global customer. Nortel understands what it takes to deliver on a relationship of this scope and scale. Its commitment to flexibility, shared goals and customer satisfaction are what make this relationship successful."
    "Managed services are critical for companies that don't want the challenges of deploying, managing and maintaining a reliable communications infrastructure and would prefer to outsource those activities to the experts," said Zeus Kerravala, vice president, Enterprise Infrastructure, Yankee Group. "The managed services business will continue to provide growth for Nortel while meeting a critical need for enterprises and other entities that want to focus on their core business activities."
    Nortel's Managed Network Services are designed to provide flexible communications infrastructure solutions with carrier-grade reliability. Nortel provides Managed Network Services to more than 70 enterprise and service provider customers worldwide.
    "This extension of our relationship with Johnson Controls demonstrates our momentum in providing Managed Network Services to enterprises," said Michael Pangia, vice president, Global Operations and Services, Enterprise, Nortel. "It reaffirms the unique value proposition Nortel can extend to customers."
    "We understand what it takes to build, deploy and manage enterprise networks with the reliability and productivity benefits that our customers demand," Pangia said. "By combining the strengths of our global channel partners with our own network expertise and support infrastructure, we are able to deliver to our customers an industry-leading managed network solution. Nortel Managed Network Services allow companies of all sizes in all industries to reap the benefits of being able to focus on their business without distraction."
    Over 93 percent of the top 100 manufacturing companies -- including aerospace, pharmaceutical, automotive, and IT companies -- run on Nortel solutions. Nortel's Managed Network Services help to ease customer transition to next generation technologies, reduce financial risk through predictable network support and operations costs, and improve network performance and reliability. Nortel's world-class Global Managed Network Services infrastructure supports in excess of 250,000 voice ports and 10,000 data elements for some of the largest, most sophisticated enterprises and service providers in the world.

    About Johnson Controls, Inc.

    Johnson Controls, Inc. is a global market leader in automotive systems and facility management and control. In the automotive market, it is a major supplier of integrated seating and interior systems, and batteries to BMW, DaimlerChrysler, Ford, General Motors, Honda, Mazda, Mitsubishi, Nissan, Renault, Rover, Toyota and Volkswagen. For non-residential facilities, Johnson Controls provides control systems and services including comfort, energy and security management to Ameritech, GlaxoSmithKline, JCPenney and Novartis as well as 7,000 U.S. school districts, more than 2,000 hospitals and tens of thousands of other non-residential and government buildings. Johnson Controls (NYSE:JCI), founded in 1885, has headquarters in Milwaukee, Wis. Its sales for 2003 totaled $22.6 billion. JCI employs over 118,000 employees across 500 sites with operations spanning the globe. For more information on Johnson Controls, Inc., visit the company's web site at www.johnsoncontrols.com.

    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; the findings of Nortel's independent review and implementation of recommended remedial measures; the outcome of the 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 controls over financial reporting; the impact of Nortel's and NNL's failure to timely file their financial statements and related periodic reports, including breach of its support facility and public debt obligations and Nortel's inability to access its shelf registration statement filed with the United States Securities and Exchange Commission (SEC); ongoing SEC reviews, which may result in changes to our public filings; the potential delisting or suspension of Nortel's and NNL's publicly traded securities; the impact of management changes, including the termination for cause of Nortel's former CEO, CFO and Controller in August 2004; the sufficiency of Nortel's restructuring activities, including the work plan announced on August 19, 2004 as updated on September 30, 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; 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 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 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; stock market volatility generally and as a result of acceleration of the settlement date or early settlement, which is currently not available, of Nortel's forward purchase contracts; 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; and the future success of Nortel's strategic alliances.
    For additional information with respect to certain of these and other factors, see the most recent Annual Report on Form 10-K 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.
    Use of the terms "partner" and "partnership" does not imply a legal partnership relationship between Nortel and any other party.

--30--BD/da*

CONTACT: Nortel Pat Cooper, 425-450-7523 email: pat.cooper@nortel.com www.nortel.com

KEYWORD: CALIFORNIA WISCONSIN TEXAS INTERNATIONAL CANADA INDUSTRY KEYWORD: AUTOMOTIVE TELECOMMUNICATIONS NETWORKING COMPUTERS/ELECTRONICS PRODUCT MARKETING AGREEMENTS SOURCE: Nortel

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