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Nortel’s New Business Solutions Bring Power of IP to Small and Medium Sized Businesses


October 30, 2007

BOSTON – New IP Powered Business solutions from Nortel* [NYSE/TSX: NT] are making it easy for service providers around the world to sell and host pre-tested VoIP services to small and medium sized businesses (SMB). These solutions, announced today at the  Fall VON Conference**  in Boston, combine the latest VoIP technology with planning, installation, management and technical support from Nortel's portfolio of  Global Services for SMBs . They also include marketing support to help service providers target and sell VoIP to the growing SMB market.

"As the world leader in both carrier and enterprise VoIP, Nortel is uniquely positioned to deliver a full-range of simple solutions for SMBs that easily allow carriers to offer advanced IP services without the cost or complexity often associated with next-generation communication services," said Alf Decardenas, general manager, Carrier Multimedia Networks, Nortel. "The needs of SMBs vary dramatically, and as a result, they require VoIP packages that can provide a range of options from fully hosted to onsite IP solutions. Nortel's new IP Powered Business Solutions can help SMBs deliver big business services like unified communications, integrated multimedia messaging and voice services like Automatic Call Distribution (ACD) with a simple yet powerful IP solution made specifically with the needs of SMBs in mind."

Nortel's IP Powered Business Solutions provide two different network solutions to facilitate VoIP adoption by SMBs. The first option is an end-to-end VoIP Lines Solution which is targeted to SMBs without an IT department or specialized IT staff. With this option, the carrier delivers the IP Lines service from the Nortel  Communication Server (CS) 2000  or  Application Server (AS) 5200 , or as a Nortel Hosted Solution. The carrier can also sell or lease a wide range of Nortel SIP phones and PC soft clients as well as Nortel's highly reliable  Business Services Gateway (BSG)  to the SMB.

The second option is the IP PBX Interconnect Solution, for SMBs preferring an on-site PBX, like the multi-award-winning Nortel  Business Communications Manager (BCM) 50  which has shipped more than 67,000 units since its availability in May 2005. Nortel's BCM is a next generation voice solution for SMBs that builds off of years of market leadership from Nortel's traditional key system for SMBs, Norstar. In the IP PBX Interconnect Solution, carriers can host the connection between the telephone switching system and the public network from the Nortel CS2000. They can also sell or lease the Nortel BSG and SIP phones. In this scenario, the natural extension is to offer system management services as well. Both options offer a hybrid IP solution meaning the solutions are capable of operating on traditional TDM line equipment, IP lines or both ensuring that SMBs can preserve their investment in existing TDM infrastructure while migrating to IP at their own pace.

"Operationally, SMBs are smaller than large enterprises but they still demand the same technology to deliver big business services," said Elisabeth Rainge, IDC program director, Network Software. "Carriers can play a key role in offering IP solutions for SMBs that are less costly, less complex and easy to operate even if the SMB does not have a specialized IT department in-house. Solutions that have the specific needs of SMBs in mind while maintaining the same top-of-the-line services that carriers and other suppliers offer to big businesses will help accelerate the uptake of VoIP solutions in the growing SMB market."

All options of Nortel's IP Powered Business Solutions provide starter VoIP bundles that simplify and reduce the SMB's cost of implementing new IP services through pre-tested, validated solutions. In addition to the VoIP bundles, Nortel will also be offering optional advanced SIP applications like multimedia services,  fixed mobile convergence (FMC) , web services like click-to-connect,  unified messaging (UM)  through Nortel's UM partners StreamWIDE and IP Unity-Glenayre and  unified communications (UC)  through our alliance with Microsoft.

The Carriers purchasing these IP Powered Business Solutions are aided in their outreach to the SMB market via marketing and sales tools that include SMB sales guides, end user business cases, market pricing benchmarks and an SMB Customer Premise Equipment (CPE) quote builder. In addition, Nortel will be supporting the carrier's move to hosted SMB solutions by making available a suite of demo kits to the carrier enabling sales personnel to understand the functionality that would be provided to the SMB IP office. These services will help make it easy for operators to rapidly sell and deploy fully-tested VoIP solutions to SMBs globally.

Nortel's IP Powered Business Solutions build upon Nortel's recognized global leadership in the SMB market as well as both the Enterprise and Carrier spaces. According to Dell'Oro Group, Nortel is the worldwide leader in Carrier VoIP and has been for five years running (2002-2006). As well, Dell'Oro has named Nortel's Norstar the leading Traditional Key Line Shipment in the SMB market for five consecutive years. Nortel is also the worldwide leader in Enterprise VoIP for the first half of 2007 and has been for three years running (2004-2006) according to both Dell'Oro Group and Infonetics. Both the VoIP Lines and IP-PBX Interconnect solution will be ready for deployment in 1Q08.

About Nortel

Nortel is a recognized leader in delivering communications capabilities that make the promise of Business Made Simple a reality for our customers. Our next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel's technologies are designed to help eliminate today's barriers to efficiency, speed and performance by simplifying networks and connecting people to the information they need, when they need it. Nortel does business in more than 150 countries around the world. For more information, visit Nortel on the Web at www.nortel.com . For the latest Nortel news, visit www.nortel.com/news .

Certain statements in this press release may contain words such as "could", "expects", "may", "anticipates", "believes", "intends", "estimates", "targets", "envisions", "seeks" and other similar language and are considered forward-looking statements or information under applicable securities legislation. These statements are based on Nortel's current expectations, estimates, forecasts and projections about the operating environment, economies and markets in which Nortel operates. These statements are subject to important assumptions, risks and uncertainties, which are difficult to predict and the actual outcome may be materially different from those contemplated in forward-looking statements. For additional information with respect to certain of these and other factors, see Nortel's Annual Report on Form10-K, Quarterly Reports on Form 10-Q and other securities filings 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.

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Contacts for Press and Analysts:

Miranda MacDonald
905-863-1098
mirandam@nortel.com

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