Verizon Wireless Awards Nortel an Expected US$2B Supply Deal
December 19 2006 - 10:00AM
PR Newswire (US)
Building Network for Mobile Multimedia and Data Growth BASKING
RIDGE, N.J. and TORONTO, Dec. 19 /PRNewswire-FirstCall/ --
Nortel(x) (NYSE/TSX: NT) and Verizon Wireless, the nation's leading
wireless service provider, have signed an expected five-year, US$2
billion agreement for Nortel equipment and services that will
contribute to continued improvements and expansion of Verizon
Wireless' network. The planned Verizon Wireless network expansion
comes as business and consumer adoption of services that utilize
broadband networks - such as the company's V CAST video and music
services and BroadbandAccess high-speed Internet and e-mail
offering - are resonating in the marketplace. With data services
accounting for 14 percent of Verizon Wireless' revenue from its
nearly 57 million customers in the third quarter of 2006, Nortel's
support will be instrumental as Verizon Wireless builds upon its
lead in network quality and reach in the U.S. "The popularity of
Internet services like user-generated videos, online gaming, music
and video is driving an explosion in bandwidth demand," said
Richard Lowe, president, Mobility and Converged Core Networks,
Nortel. "Consumers expect more from their mobile devices than voice
communication and text-messaging. Nortel is making it simple for
Verizon Wireless to expand its network to meet this demand and to
competitively drive new services to market that their customers
will enjoy." "This expansion underscores our focus on investing in
innovative technology and leveraging long-term, strategic
relationships with leaders like Nortel to continually enhance our
subscribers' mobile communication experience," said Ed Salas,
network planning vice president, Verizon Wireless. "This means true
mobility for our customers, allowing them to take their PC
experience with them wherever they go and enjoy things like V CAST
Music, V CAST video, great mobile games and high-speed file
transfers on the nation's best wireless network." Under this
agreement, Verizon Wireless plans to deploy additional CDMA2000
radio base stations, switching, IP platforms, optical networking
solutions and related equipment with the help of professional
services from Nortel. In addition, this agreement builds on the
contract announced in July 2006, whereby Nortel was selected to
supply Verizon Wireless with CDMA 1xEV-DO Revision A technology.
The ability for CDMA networks to provide significant performance
enhancements through simple upgrades is a key advantage of the
underlying technology. "This contract confirms Nortel's leadership
in supplying innovative CDMA mobile broadband technologies and
driving advanced communication services," added Lowe. "It's our
long term partners that know us best, so we're particularly proud
when an industry leader like Verizon Wireless asks us to be part of
their team for another five years." This new agreement also
presents an opportunity for Verizon Wireless and Nortel to further
develop and deploy next-generation IMS-based applications and
services. In addition, Nortel, Verizon Wireless and other industry
suppliers will continue to work together to enhance industry
standards and define an IMS architecture that lays a foundation for
the efficient roll-out of advanced services. Nortel has been a key
supplier to Verizon Wireless' nationwide network for more than a
decade. Nortel has been a leader in CDMA since 1995 and has
launched more CDMA networks than any other vendor, according to the
CDMA Development Group. 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. Our next-generation
technologies, for both service providers and enterprises, span
access and core networks, support multimedia and business-critical
applications, and help eliminate today's barriers to efficiency,
speed and performance by simplifying networks and connecting people
with information. Nortel does business in more than 150 countries.
For more information, visit Nortel on the Web at
http://www.nortel.com/. For the latest Nortel news, visit
http://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. Further, actual results
or events could differ materially from those contemplated in
forward-looking statements as a result of the following (i) risks
and uncertainties relating to Nortel's restatements and related
matters including: Nortel's most recent restatement and two
previous restatements of its financial statements and related
events; the negative impact on Nortel and NNL of their most recent
restatement and delay in filing their financial statements and
related periodic reports; legal judgments, fines, penalties or
settlements, or any substantial regulatory fines or other penalties
or sanctions, related to the ongoing regulatory and criminal
investigations of Nortel in the U.S. and Canada; any significant
pending civil litigation actions not encompassed by Nortel's
proposed class action settlement; any substantial cash payment
and/or significant dilution of Nortel's existing equity positions
resulting from the approval of its proposed class action
settlement; any unsuccessful remediation of Nortel's material
weaknesses in internal control over financial reporting resulting
in an inability to report Nortel's results of operations and
financial condition accurately and in a timely manner; the time
required to implement Nortel's remedial measures; Nortel's
inability to access, in its current form, its shelf registration
filed with the United States Securities and Exchange Commission
(SEC), and Nortel's below investment grade credit rating and any
further adverse effect on its credit rating due to Nortel's
restatements of its financial statements; any adverse affect on
Nortel's business and market price of its publicly traded
securities arising from continuing negative publicity related to
Nortel's restatements; Nortel's potential inability to attract or
retain the personnel necessary to achieve its business objectives;
any breach by Nortel of the continued listing requirements of the
NYSE or TSX causing the NYSE and/or the TSX to commence suspension
or delisting procedures; (ii) risks and uncertainties relating to
Nortel's business including: yearly and quarterly fluctuations of
Nortel's operating results; reduced demand and pricing pressures
for its products due to global economic conditions, significant
competition, competitive pricing practice, cautious capital
spending by customers, increased industry consolidation, rapidly
changing technologies, evolving industry standards, frequent new
product introductions and short product life cycles, and other
trends and industry characteristics affecting the
telecommunications industry; the sufficiency of recently announced
restructuring actions, including the potential for higher actual
costs to be incurred in connection with these restructuring actions
compared to the estimated costs of such actions and the ability to
achieve the targeted cost savings and reductions of Nortel's
unfunded pension liability deficit; any material and adverse
affects on Nortel's performance if its expectations regarding
market demand for particular products prove to be wrong or because
of certain barriers in its efforts to expand internationally; any
reduction in Nortel's operating results and any related volatility
in the market price of its publicly traded securities arising from
any decline in its gross margin, or fluctuations in foreign
currency exchange rates; any negative developments associated with
Nortel's supply contract and contract manufacturing agreements
including as a result of using a sole supplier for key optical
networking solutions components, and any defects or errors in
Nortel's current or planned products; any negative impact to Nortel
of its failure to achieve its business transformation objectives,
including completion of the sale of its UMTS access business to
Alcatel-Lucent; additional valuation allowances for all or a
portion of its deferred tax assets; Nortel's failure to protect its
intellectual property rights, or any adverse judgments or
settlements arising out of disputes regarding intellectual
property; changes in regulation of the Internet and/or other
aspects of the industry; Nortel's failure to successfully operate
or integrate its strategic acquisitions, or failure to consummate
or succeed with its strategic alliances; any negative effect of
Nortel's failure to evolve adequately its financial and managerial
control and reporting systems and processes, manage and grow its
business, or create an effective risk management strategy; and
(iii) risks and uncertainties relating to Nortel's liquidity,
financing arrangements and capital including: the impact of
Nortel's most recent restatement and two previous restatements of
its financial statements; any inability of Nortel to manage cash
flow fluctuations to fund working capital requirements or achieve
its business objectives in a timely manner or obtain additional
sources of funding; high levels of debt, limitations on Nortel
capitalizing on business opportunities because of support facility
covenants, or on obtaining additional secured debt pursuant to the
provisions of indentures governing certain of Nortel's public debt
issues and the provisions of its support facility; any increase of
restricted cash requirements for Nortel if it is unable to secure
alternative support for obligations arising from certain normal
course business activities, or any inability of Nortel's
subsidiaries to provide it with sufficient funding; any negative
effect to Nortel of the need to make larger defined benefit plans
contributions in the future or exposure to customer credit risks or
inability of customers to fulfill payment obligations under
customer financing arrangements; any negative impact on Nortel's
ability to make future acquisitions, raise capital, issue debt and
retain employees arising from stock price volatility and further
declines in the market price of Nortel's publicly traded
securities, or the share consolidation resulting in a lower total
market capitalization or adverse effect on the liquidity of
Nortel's common shares. For additional information with respect to
certain of these and other factors, see Nortel's Annual Report on
Form10-K/A, 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. (x)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 between Nortel and any other party.
DATASOURCE: Nortel CONTACT: Jamie Moody, (972) 684-7167, ; Karen
Monaghan, (613) 763-1133, ; Jeffrey Nelson, (908) 559-7519,
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