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October 27, 2003

Turkey’s General Directorate of Security Offers E-Goverment Services Nationwide

ISTANBUL, Turkey – Turkey’s General Directorate of Security now handles applications and related transactions for passports, visas, driver’s licenses and other important documents electronically using advanced local (LAN) and wide area (WAN) data network solutions from Nortel Networks* [NYSE/TSX: NT].

The Directorate also uses these Nortel Networks solutions to help police and other law enforcement agencies fight crime more effectively by providing electronic access to a database – Turkey’s largest – of warrants, fingerprints, ballistics, DNA, blood and tissue analysis, and other critical information.

These and other new E-Government services are available nationwide over a multi-million dollar network connecting 10 regional government centres. This network, recently recognized with the Turkish Interpro Communications Project Award, was deployed across the country by Meteksan, a local Nortel Networks ‘channel partner.’

E-Government services have positioned the General Directorate of Security to respond quickly to the needs of Turkish citizens by reducing bureaucracy and driving greater employee efficiency and productivity.

The current deployment represents the first phase of the Directorate’s POLNET (Police Network) and TRANSPOL (Police Transmission) network projects. Plans call for a second phase – under a separate tender still to be awarded – that will connect police stations and other security offices in smaller cities across Turkey by 2005, according to Ahmet Kocabal, head of Information Technology for the General Directorate of Security.

“Our personnel are on the way to becoming the police force of the ‘modern ages’ with these projects,” Kocabal said. “If we can issue a passport in one day and if we can find out whether or not there is a search warrant on someone in 30 seconds, we are improving services to our citizens as well as respecting human rights. Thus, we are avoiding any inconvenience to innocent people by pinpointing the criminals directly.”

The Directorate’s new network is based on Nortel Networks Passport* Multiservice Switch portfolio. Passport Multiservice Switches provide Quality of Service (QoS) features from the edge to the core. This allows enterprises to maximize infrastructure investments by converging voice, data and video applications onto a single, multiservice backbone network. It also positions enterprises to drive reduced costs, and is engineered to provide back-up in the event of a natural disaster or other crisis. Nortel Networks Preside* Multiservice Data Manager allows the Directorate to administer the entire network from a single system.

“In an E-Government application, the government must be modernized, and the communications and coordination between government units must be increased,” said Sinan Dumlu, director, Enterprise Solutions, Nortel Networks. “While the service diversity and quality assigned to the individual and institutions are increased, costs of government units must be reduced and become more controllable. Beyond that, the accuracy and security of information must also be increased. From this respect, significant steps were taken with the implementation of these projects, and an important leg of E-Government has been activated.”

Nortel Networks was the global market share leader in multiservice switching for nine consecutive quarters as of the end of the second quarter 2003, according to Synergy Research Group. With more than 40,000 systems deployed in over 1,500 customer networks globally, the Passport family of multiservice switches has proven field experience in delivering in-service reliability.

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 and continued reductions in spending by our customers; 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 integrate the operations and technologies of acquired businesses in an effective manner; the impact of rapid technological and market change; the impact on our gross margins and other impacts 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; the dependence on new product development and our ability to predict market demand for particular products; the uncertainties of the Internet; the impact of the credit risks of our customers and the impact of customer financing and commitments; the impact of a consolidation of our common shares; stock market volatility generally and as a result of acceleration of the settlement date or early settlement of our purchase contracts; the entrance into an increased number of supply and outsourcing contracts which contain delivery and installation 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 outcome of our asset and liability review; the future success of our strategic alliances; risks related to our defined benefit plans; the impact of additional valuation allowances for all or a portion of our deferred tax assets required if market conditions further deteriorate or future results of operations are less than expected; an inability of our subsidiaries to provide funding to the respective parent companies; restrictions on our cash as cash collateral if satisfactory arrangements for alternative support for certain obligations are not in place; and the adverse resolution of litigation and intellectual property disputes. For additional information with respect to certain of these and other factors, see the most recent Form 10-Q and Form 10-K 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.

Use of the terms “partner” and “partnership” does not imply a legal partnership relationship between Nortel Networks and any other party.

*Nortel Networks, the Nortel Networks logo, the Globemark, Business Without Boundaries, Passport and Preside are trademarks of Nortel Networks.

Contact for Press and Analysts:

Giorgia Casnedi
Nortel Networks
+44 1628 43 3117
casnedi@nortel.com

Arzum Satir
Nortel Networks
+90 216 522 2380
asatir@netas.com.tr

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