[Sierra Wireless and Xircom are working with Nortel Networks to develop high speed wireless IP 3G modems.]

Boston, Mass. -- Nortel Networks* [NYSE/TSE: NT] has signed agreements under which it will assist both Sierra Wireless [NASDAQ: SWIR; TSE: SW] and Xircom [NASDAQ: XIRC] to independently develop the industry's first third generation (3G) wireless modems based on the UMTS (Universal Mobile Telecommunications System) standard, accelerating availability of these modems to enable 'anytime, anywhere' access to rich Internet content through digital devices of all kinds.

Sierra Wireless and Xircom both plan to develop their own multi-mode UMTS/GPRS (General Packet Radio Service) wireless modems in form factors including PC cards, Compact Flash cards and embedded modules. Nortel Networks will help fund these development efforts, and provide technical and joint marketing support. Plans call for market trials and general availability in the first half of 2002.

"We're combining the intelligence of IP (Internet Protocol), the accessibility of the Wireless Internet and lightning fast Internet access to any device, any time," said Frank Plastina, president, Wireless Internet, Nortel Networks. "We expect these new modems to provide the 'missing link,' unleashing a torrent of data by freeing applications from the desktop and enabling a new wave of applications and services that are scarcely imaginable at today's speeds."

Accelerated availability of 3G wireless modems is also expected to enable Nortel Networks service provider customers to take full advantage of the Wireless Internet revolution. Mobile professionals and consumers will be able to plug them into personal digital assistants (PDAs), laptop computers, in-vehicle information systems, MP3 players, digital cameras and other IP-enabled personal digital devices for untethered access to e-mail, eBusiness, mobile commerce and multimedia services over 3G networks.

"At BT Wireless, we intend to maintain our current lead in mobile data when we launch our 3G service," said Tony Greaves, senior vice president, 3G & Airwave, BT Wireless. "Availability of device supply is key. We expect a range of 3G devices to be commercially available in 2002, and we are talking with a number of manufacturers worldwide. The activities announced today will help to ensure early availability and choice of products, and provide us with options for early priority ordering through our strategic relationship with Nortel Networks."

"We're committed to enabling mobile users to take full advantage of the high-performance Internet," said Peter MacKinnon, vice president, Wireless Internet, Nortel Networks. "We expect a plethora of connected wireless IP appliances to spur tremendous growth of wireless data, allowing service providers to differentiate services profitably and grow average revenue per user."

Development of 3G wireless modems will support Nortel Networks 'Wings of Light' strategy, which combines optical, wireless and IP technologies to help operators provide highly reliable, high-speed access to Internet services and applications.

Nortel Networks recently announced an estimated US$1.8 billion in European UMTS network awards, including a five-year contract with BT Wireless subsidiary BT Cellnet in the United Kingdom, a 12-month build out for Airtel in Spain, and a three-year deal with Xfera, also in Spain.

"Working with Nortel Networks on UMTS drives Sierra Wireless firmly into a strong global position," said Andrew Harries, senior vice president, corporate development, Sierra Wireless. "We are currently leading the way in the North American market for 2.5G and 3G wireless modems and are focused on wirelessly enabling notebooks and PDAs. Today's announcement continues our drive for technology leadership, complete and compelling 3G solutions, and a strong global presence."

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