Nortel Networks

Nortel to Capitalize on Growth in Video Bandwidth

    Toronto, Canada (ots/PRNewswire) -

    - Metro Ethernet Networks Builds on Nortel's Optical and Carrier Data  Leadership

    Nortel(x) (NYSE: NT , TSX: NT) President and CEO Mike Zafirovski today  announced a new business focus on driving market share in super-fast  Ethernet networks essential to handling the coming growth of bandwidth- hungry video applications.

    Nortel's strategic initiative - Metro Ethernet Networks - will be led  by Philippe Morin as president. This initiative will offer innovative  Ethernet portfolios designed to deliver high quality, reliability and security.

    "Nortel's future depends on our continued leadership in innovation and  with our new Metro Ethernet Networks we're bringing our best technologies  together, backed by an initial incremental investment in R&D," said  Zafirovski. "In his previous position as general manager, Optical, Philippe  grew the business approximately 24 percent last year to US$1.2 billion. I  have every confidence he will build on that leadership and momentum through  Metro Ethernet Networks."

    "With IPTV, IMS and other applications evolving quickly, service providers will face huge bandwidth challenges across all networks - wireless, wireline and cable. Metro Ethernet Networks is the first step in  getting Nortel in front of that curve to win in this critical new space in  the market," said Zafirovski.

    Nortel's Metro Ethernet Networks business strategy is based on the increasing reliance on Ethernet as the standard protocol for both LAN and  WAN communications to break the bandwidth bottleneck between high-speed  fibre- optic networks and metro networks serving consumers and business. In  addition, Nortel's Metro Ethernet Networks will focus on wireless  capabilities, using its Metro Ethernet solution to ensure such applications  as high-bandwidth video provide real-time speed and quality to mobile devices.

    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 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 ", "plans", "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. Although Nortel believes expectations reflected in such forward- looking statements are reasonable based upon certain assumptions, they may  prove to be inaccurate and consequently Nortel's actual results or events  could differ materially from its expectations set out in this press release . 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 (including  the anticipated delay in filing the Quarterly Reports on Form 10-Q for the  first quarter of 2006) causing them to breach their public debt indentures  and, if the delay extends beyond June 15, 2006, their obligations under  their credit facilities, with the possibility that the holders of their  public debt or NNL's lenders would seek to accelerate the maturity of that  debt, and causing, if the delay extends beyond June 15, 2006, a breach of NNL's support facility with EDC with the possibility that EDC would refuse  to issue additional support under the facility, terminate its commitments under the facility or require NNL to cash collateralize all existing support; 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 finalization and approval of its proposed  class action settlement, or if such proposed class action settlement is not finalized, any larger settlements or awards of damages in respect of such  class actions; 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 restatement 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; any default in Nortel's filing  obligations extending beyond July 15, 2006 for the 2006 First Quarter Form  10-Qs, causing any Canadian securities regulatory authority to impose an  order to cease all trading in Nortel's securities within the applicable  jurisdiction or to impose such an order sooner if Nortel fails to comply  with the alternate information guidelines of such regulatory authorities; ( 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; 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; 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 acceleration under their public debt  indentures and credit facilities, which may result in Nortel and NNL being  unable to meet their respective payment obligations; 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 credit 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 credit facilities; 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 any future 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 the Company's Annual Report on Form 10-K/A and NNL's Annual  Report on Form 10-K 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.

ots Originaltext: Nortel Networks
Im Internet recherchierbar: http://www.presseportal.ch

Contact:
For further information: Patricia Vernon, +1-(905)-863-1035,
patricve@nortel.com; Jay Barta, +1-(972)-685-2381, jbarta@nortel.com



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