Nortel Secures New Footprint with Horizon PCS; Wireless Infrastructure

    Business Editors/Technology Editors

    DALLAS--(BUSINESS WIRE)--Feb. 3, 2005--Horizon PCS, Inc. (Pink Sheets: HZPS) has selected wireless infrastructure technology from Nortel (NYSE: NT) (TSX: NT) to increase network capacity, improve call quality and enable delivery of advanced, high-speed data services to wireless subscribers in Ohio, Indiana and Tennessee.
    Under a four-year, estimated US$14 million agreement, Nortel will replace the existing Horizon PCS CDMA network in Ohio, Indiana and Tennessee, which covers a population of approximately three million people. This is Nortel's first CDMA wireless infrastructure contract with Horizon PCS.
    The new network will position Horizon PCS to create efficiencies that will help drive reduced operating and capital costs and speed time-to-market and time-to-profit for next generation services.
    "We selected Nortel equipment and professional services because of its innovation and reliability with CDMA 1X and EV-DO technology," said Jerry Miller, vice president, Network Operations, Horizon PCS. "Our conversion to Nortel's data and voice technology will allow Horizon PCS to more cost-effectively address network capacity needs as subscriber counts and usage increase. It will also enable us to provide CDMA 1X voice and data services to 100 percent of our service area, and will lay the foundation for delivery of the more compelling and personalized wireless data services our customers desire."
    The Nortel CDMA 1X equipment being deployed for Horizon PCS can support wireless data services like Web browsing, real-time e-mail, streaming audio and video, multimedia messaging, location-based services, m-commerce, Virtual Private Networks (VPNs), and other high-speed wireless data services that enhance the communication experience for business and consumers. This conversion to Nortel infrastructure equipment will better position Horizon PCS for future deployment of EV-DO high-speed data network elements.
    "Nortel is pleased to have been chosen by Horizon PCS to provide our industry-leading 1X and EV-DO-capable solution, and we look forward to working with them to deliver compelling services and applications that enhance the subscriber experience," said Richard Lowe, president, CDMA Wireless Networks, Nortel. "This contract represents new footprint for Nortel and demonstrates our momentum in the CDMA and wireless infrastructure space."
    The agreement includes CDMA mobile switching equipment, base stations and software for service provisioning, and network operations and management. In addition, Nortel will provide wireless professional services, including project management, radio frequency (RF) engineering, and network engineering.
    Horizon PCS will deploy Nortel's industry-leading Compact Metro Cell BTS and CDMA Enhanced Base Station Controller (EBSC). The Compact Metro Cell BTS is a highly flexible, scalable and power-efficient third generation (3G) base station. Focused on reducing operational expenses and increasing profitability, Compact Metro Cell offers 'pay as you grow' flexibility and modular design, ensuring maximum investment protection for wireless operators. The EBSC is an ATM packet-based system that connects CDMA base stations to the mobile switching center (MSC). The EBSC provides mobility functions such as soft handoff between cells and power control of individual traffic channel links.
    The all-digital Horizon PCS wireless network is built to be compatible with Sprint's 100-percent digital, nationwide PCS wireless network.
    Nortel has designed, installed and launched more than 300 wireless networks in over 50 countries. Nortel was the industry's first supplier with wireless networks operating in all advanced radio technologies (GSM/GPRS/EDGE, CDMA2000 1X and 1xEV-DO, UMTS and WLAN), and is the only end-to-end provider of all next generation wireless solutions.

    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 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.

--30--LR/da*

CONTACT: Nortel Jamie Moody, 972-684-7167 Email: moodyjam@nortel.com Website: www.nortel.com

KEYWORD: INDIANA TEXAS TENNESSEE OHIO INDUSTRY KEYWORD: TELECOMMUNICATIONS SOFTWARE NETWORKING HARDWARE PRODUCT SOURCE: Nortel

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