[Nortel Network's latest contract win brings their 2001 Chinese contract total up to US$1.2 billion.]

Beijing -- China Mobile, the largest wireless carrier in the People's Republic of China, has awarded contracts valued at approximately US$78 million to Nortel Networks for a major expansion of its GSM digital cellular network in Xinjiang Uygur Autonomous Region, as well as network software upgrades and network optimization in Xinjiang and three other areas.

Nortel Networks GSM solutions are designed to create a strong, revenue-generating platform for the future, and will help China Mobile to quickly bring to market new, differentiating services, such as wireless advertising, prepaid calling, location inquiry, virtual private networks, and location-based services.

In Xinjiang, Nortel Networks has already completed a network optimization project for China Mobile, and will now implement its fifth expansion of China Mobile's existing GSM 900 digital cellular network, increasing subscriber capacity by 600,000 to more than one million. Nortel Networks will deploy network software upgrades to support advanced IN (Intelligent Network) functionality in Xinjiang, the Hunan and Shaanxi provinces, and the municipality of Tianjin. The software upgrades will also help China Mobile increase subscriber capacity in these four areas.

"China Mobile's network expansions and IN services deployment are strategic moves to enhance profitability and competitive advantage, and significantly strengthen Nortel Networks leadership position in China's wireless networking market," said Robert Mao, chief executive officer, Nortel Networks China.

"This is also the fifth GSM network expansion we have been selected to implement for China Mobile in Xinjiang," Mao said. "We view this as a compelling testimonial to the quality and reliability of our solutions and services, and an indicator of strong customer satisfaction with our ability to cost-effectively extend cellular network coverage and increase subscriber capacity within strategic timeframes."

With nearly 30 years of operating experience in Greater China, Nortel Networks has won contracts estimated to be worth more than US$1.2 billion since the start of 2001 from customers such as China Mobile. Nortel Networks is also investing in China to deliver key next generation networking solutions, and its comprehensive R&D facilities in Beijing are expected to play an important role in developing new technologies.

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