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June 27, 2001

Sprint, Nortel Networks Agree to Wireless Equipment, Services Deals

Agreement Support Continued Expansion of Sprint PCS Network

KANSAS CITY, Mo. – Nortel Networks* [NYSE/TSE: NT] and Sprint [NYSE: FON/PCS] announced agreements estimated to be worth up to approximately US$1 billion over three years to deploy enhanced wireless network equipment and professional services to support the continued expansion of the Nortel Networks portion of Sprint’s nationwide PCS wireless network.

The agreements extend and expand the existing five-year relationship between Nortel Networks and Sprint to further enhance Sprint’s high-speed PCS wireless network. Under terms of the agreements, Nortel Networks will deploy radio base station and intelligent core networking equipment. These agreements are congruent with Sprint’s planned enhancements to its wireless PCS network infrastructure and are a key part of its migration to third generation (3G) services.

These enhancements, combined with Sprint’s overall upgrade of its entire PCS network, are intended to provide ‘always on,’ next generation wireless services to consumer and business subscribers. Higher speeds are expected to enable consumers to download music and data to portable wireless devices such as phones, laptops and personal digital assistants (PDAs) directly from the Internet. Business customers are expected to be able to open e-mail attachments using wireless modems in their laptops without seeking a payphone or using expensive hotel connections.

“Nortel Networks and Sprint PCS have a long-standing relationship in not only optimizing technology, but speeding delivery of new, innovative wireless services for our subscribers,” said Dennis Huber, senior vice president, network/IT, Sprint PCS.

“Nortel Networks Wireless Internet solutions are positioning Sprint PCS to offer reliable, cost-effective, high capacity wireless services that can drive higher profits and customer loyalty,” said Frank Plastina, president, Wireless and Core Solutions, Nortel Networks. “This win demonstrates our leadership and growing momentum in the global Wireless Internet race.”

Later this year, Nortel Networks is scheduled to begin 3G upgrades to its base stations in Sprint’s existing PCS network.

Sprint is a world-class global communications company – at the forefront of integrating wireline and wireless communications services. Sprint is a large carrier of Internet traffic and a leader in broadband communications. The company built and operates the United States’ first nationwide all-digital, fiber-optic network and provides a portfolio of advanced data communications services. It operates the largest 100-percent digital, 100-percent nationwide PCS wireless network in the United States, already serving the majority of the nation’s metropolitan areas including more than 4,000 cities and communities across the country. Sprint has US$23 billion in annual revenues and serves more than 23 million business and residential customers. For more information, visit the Sprint PCS web site at www.sprintpcs.com.

This press release includes certain estimates, projections and other forward-looking statements. Future performance cannot be ensured. Actual results may differ materially from those in the forward-looking statements. Some factors that could cause actual results to differ include:
  • the effects of vigorous competition in the markets in which Sprint operates;
  • the costs and business risks related to entering new markets necessary to provide nationwide or global services and providing new services;
  • the ability of the PCS Group to continue to grow a significant market presence;
  • the effects of mergers and consolidations within the telecommunications industry;
  • the uncertainties related to Sprint's strategic investments;
  • the impact of any unusual items resulting from ongoing evaluations of Sprint's business strategies;
  • unexpected results of litigation filed against Sprint;
  • the possibility of one or more of the markets in which Sprint competes being impacted by changes in political, economic or other factors such as monetary policy, legal and regulatory changes including the impact of the Telecommunications Act of 1996, or other external factors over which Sprint has no control; and
  • other risks referenced from time to time in Sprint's filings with the Securities and Exchange Commission ("SEC").

The words "estimate," "project," "intend," "expect," "believe" and similar expressions are intended to identify forward-looking statements. You should not place undue reliance on forward-looking statements, which speak only as of the date of this press release. Sprint is not obligated to publicly release any revisions to forward-looking statements to reflect events after the date of this press release or unforeseen events. Sprint provides a detailed discussion of risk factors in periodic SEC filings and you are encouraged to review these filings.

Nortel Networks is a global Internet and communications leader with capabilities spanning Optical, Wireless, Local, Personal Internet and eBusiness. The Company serves carrier, service provider and enterprise customers globally. Today, Nortel Networks is creating a high-performance Internet that is more reliable and faster than ever before. It is redefining the economics and quality of networking and the Internet, promising a new era of collaboration, communications and commerce. Visit us 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 impact of price and product competition; the dependence on new product development; the impact of rapid technological and market change; the ability of Nortel Networks to make acquisitions and/or integrate the operations and technologies of acquired businesses in an effective manner; general industry and market conditions and growth rates; 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 uncertainties of the Internet; stock market volatility; the ability of Nortel Networks to recruit and retain qualified employees; the ability to obtain timely, adequate and reasonably priced component parts from suppliers and internal manufacturing capacity; the impact of the credit risks of our customers; the entrance by Nortel Networks into an increased number of supply, turnkey, and outsourcing contracts which contain delivery, installation, and performance provisions, which, if not met, could result in Nortel Networks having to pay substantial penalties or liquidated damages; the impact of increased provision of customer financing and commitments by Nortel Networks; potentially higher costs actually incurred in connection with restructuring actions compared to the estimated costs of such actions; and the inherent uncertainties underlying the estimates and assumptions used in calculating asset valuations. 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. 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 and the Globemark are trademarks of Nortel Networks.

Contact for Press and Analysts:

Jay Barta
Nortel Networks
972-685-2381
jbarta@nortel.com

Beatrice Germain
Nortel Networks
33 1 39 44 40 28
germainb@nortel.com

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