Nortel Achieves Industry’s First Multi-Vendor Live MIMO-Powered WiMAX Call

Collaboration with Kyocera Wireless and Runcom to Unleash New, Mobile Multimedia Services

FEBRUARY 12, 2007 - OTTAWA, Canada - Nortel* [NYSE/TSX: NT], Kyocera* Wireless and Runcom have achieved what is believed to be the industry’s first multi-vendor, live MIMO call using innovative WiMAX antenna technology. This technology is expected to deliver mobile services three to five times faster and at a much lower cost than today’s 3G networks. The groundbreaking call, which included both voice and streaming video, demonstrated the commercial viability of MIMO-powered WiMAX for networks and end-user devices.

MIMO-powered WiMAX will allow service providers to meet the high bandwidth demands of today’s mobile society without being prohibited by huge costs. This advancement has the potential to offer consumers fully mobile access to entertainment and communication tools that traditionally have been restricted to the home or office. For example, true mobility could be extended to workers for secure access and unprecedented bandwidth wherever they go; video gamers could enjoy their favorite interactive games in real-time; and children could pass the time on long drives watching their favorite shows via streaming video.

“This solidifies Nortel’s position as a leader in OFDM-MIMO which is the underlying technology of WiMAX and the basis for all 4G solutions” said Peter MacKinnon, GM of WiMAX, Nortel. “To ensure an ecosystem of MIMO-powered WiMAX, Nortel has brought together its leadership in 4G Mobile Broadband technologies with Kyocera Wireless’ expertise in consumer devices and Runcom’s pioneering developments in chipset technologies.”

“In order to be successful in the market, mobile video must be affordable for consumers,” said Monica Paolini, Senza Fili Consulting. “WiMAX, with its infrastructure, high capacity, and the proven ability to support mobility, is an excellent technology choice for operators looking to drive the costs out of mobile services while still offering the most competitive broadband speed performance.”

“As the world’s first handset manufacturer to demonstrate a MIMO-powered WiMAX device, Kyocera Wireless is in a leadership position to enable future products with the bandwidth-intensive features - like television and broadband Internet - that many consumers will demand,” said Dave Carey, vice president of strategic planning, Kyocera Wireless Corp. “Kyocera Wireless has a long track record of innovation in the wireless industry and we’re gratified to be working with Nortel and Runcom on yet another step forward in wireless technology.”

“Leading edge WiMAX technology will allow mobile customers to enjoy enhanced communication services without sacrificing the flexibility and dependability that they have come to expect from their devices and networks,” said Dr Zion Hadad, CEO, Runcom. “We expect this collaboration will provide the end to end MIMO solutions that can transform the wireless industry.”

The call took place at Nortel’s Advanced Technology Lab in Ottawa over live air using 2.5 Ghz commercial spectrums. The technology used was a prototype PCMCIA card from Kyocera Wireless powered by Runcom’s MIMO chipset, and Nortel’s WiMAX Base Station 5020. This is believed to be the industry’s first multi-vendor, end-to-end WiMAX MIMO wireless broadband solution where all components are MIMO based. Nortel signed a working agreement with Kyocera Wireless in December to bring to market MIMO-based PCMCIA cards and other devices. Based on market demand, commercial products could be available later this year. In addition, Nortel will demonstrate the MIMO-powered WiMAX solution at its booth (#145 in Hall 8) at 3GSM World Congress taking place Feb. 12-15 in Barcelona.

Nortel’s Mobile WiMAX solution is built on a foundation of MIMO, a combination of innovative transmission and antenna technologies that maximizes spectrum to deliver the lightning-fast speeds and high bandwidth essential to high-quality mobile video and TV. The power and performance of Nortel’s solution provides substantial savings to operators because WiMAX delivers high-speed, broadband fixed and mobile services wirelessly to large areas with minimal infrastructure.

About Nortel

Nortel is a recognized leader in delivering communications capabilities that make the promise of Business Made Simple a reality for our customers. Our next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel’s technologies are designed to help eliminate today’s barriers to efficiency, speed and performance by simplifying networks and connecting people to the information they need, when they need it. Nortel does business in more than 150 countries around the world. For more information, visit Nortel on the Web at www.nortel.com. For the latest Nortel news, visit www.nortel.com/news.

About Kyocera

Kyocera Wireless Corp. is a leading supplier of innovative, feature-rich CDMA wireless devices and accessories for customers worldwide. Kyocera Wireless maintains an operating belief in the genius of simplicity and strives to make the wireless experience as simple and intuitive as humanly possible. The company is a wholly owned subsidiary of Kyocera International Inc., which acquired QUALCOMM Incorporated’s CDMA consumer wireless phone business in February 2000. Based in San Diego, the company is ISO-14001 and ISO-9001 certified and has won city, state and federal awards for its environmentally friendly manufacturing and recycling practices. For more information, please visit www.kyocera-wireless.com**.

Kyocera Corporation (NYSE: KYO), the parent and global headquarters of the Kyocera Group, was founded in 1959 as a producer of advanced ceramics. By combining these engineered materials with metals and plastics, and integrating them with other technologies, Kyocera has become a leading supplier of telecommunications equipment, semiconductor packages, electronic components, cameras, laser printers, copiers, solar energy systems and industrial ceramics. During the year ended March 31, 2006, Kyocera Corporation’s consolidated net sales totaled approximately US$10 billion (JP¥ 1,181,489 million) with net income of approximately US$596 million (JP¥ 69,696 million).

About Runcom

Runcom is a technology company pioneering OFDMA based silicon solutions for User Terminals and Base Stations that comply with the IEEE802.16e-2005 standard for WiBro and Mobile WiMax applications, Runcom Products include the PHY and MAC communication layers. Runcom RNA200 ASIC was the first Mobile WiMax compliant ASIC in the Market. For more information, visit Runcom on the Internet: http://www.runcom.com**.

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 objective; 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.

*Nortel, the Nortel logo and the Globemark are trademarks of Nortel Networks. Kyocera is a registered trademark of Kyocera Corporation. All other marks are properties of their respective owners.

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