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Nortel Networks Corporation

One of the World's Largest Multimedia Converged IP Networks for King Abdulaziz Endowment Project in Mecca

Mecca, Saudi Arabia (ots/PRNewswire)

Future Entertainment Works
(FEW) is building one of the world's largest and most advanced IP
converged networks for the King Abdulaziz Endowment Project (KAEP) in
the Holy City of Mecca, Saudi Arabia, based on Nortel(x) (NYSE: NT ;
TSX: NT) technology.
Located adjacent to the Grand Mosque, KAEP is a very large urban
development project that consists of six residential and commercial
towers and a five-star hotel, built on a multi-story podium. KAEP's
state-of-the-art, fully IP-based network will provide its guests and
businesses with a host of more than 16 innovative IP services such as
IPTV,  video-on-demand, retail, consumer information and advertising.
FEW selected Nortel following a rigorous evaluation to ensure that
the new network meets the highest standards of security and
reliability with flexibility to expand to additional services in the
future.
"We chose Nortel because we believe that Nortel has not only the
right products for us, but also a clear vision for and commitment to
the development of IP networks," said Amr Taher, president of BT
Applied Technologies and the senior consultants for the project.
"This network will provide the most advanced capabilities and
facilities for the people it will be serving, not only today but also
far into the future."
"A development of this scale and scope is a strong endorsement of
Nortel's Enterprise IP technology and underlines Nortel's flexibility
and ability to understand the customer's needs," said Ramin Attari,
general manager Middle East, Nortel EMEA.
"This is an important project, not only because it signals
Nortel's capability to manage projects of this scale in the Middle
East market but because it is an impressive vote of confidence in the
strength of Nortel's products, innovation and people when evaluated
against stringent and demanding criteria," Attari added.
KAEP's network will consist of 65,000 ports for all manner of
communications equipment including TV, Phones, Computers, and
virtually any IP-based device. At its heart is the Nortel
Communication Server 1000 IP Telephony solution with an initial
deployment of around 18,000 IP phones, ultimately expected to grow to
26,000 IP phones. The network solution incorporates 400 switches from
the Ethernet Routing Switch 8600 and 8300 portfolio and will support
the needs not only of residential users, but also underpin the
success of hospitality, commercial and other entertainment and
lifestyle outlets being constructed as part of the huge 800,000
square metre multi-purpose development.
The KAEP development, which started construction in 2003, is set
for completion in 2007. The actual implementation of the Nortel
infrastructure has commenced and is scheduled to be completed in
early 2006, with two additional phases to the implementation before
the project's completion.
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. Serving both service provider and enterprise customers,
Nortel delivers innovative technology solutions encompassing
end-to-end broadband, Voice over IP, multimedia services and
applications, and wireless broadband designed to help people solve
the world's greatest challenges. 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 information included in this press release is
forward-looking and is subject to important risks and uncertainties.
The results or events predicted in these statements may differ
materially from actual results or events. Factors which could cause
results or events to differ from current expectations include, among
other things: the outcome of regulatory and criminal investigations
and civil litigation actions related to Nortel's restatements and the
impact any resulting legal judgments, settlements, penalties and
expenses could have on Nortel's results of operations, financial
condition and liquidity, and any related potential dilution of
Nortel's common shares; the findings of Nortel's independent review
and implementation of recommended remedial measures; the outcome of
the ongoing independent review with respect to revenues for specific
identified transactions, which review will have a particular emphasis
on the underlying conduct that led to the initial recognition of
these revenues; the restatement or revisions of Nortel's previously
announced or filed financial results and resulting negative
publicity; the existence of material weaknesses in Nortel's internal
control over financial reporting and the conclusion of Nortel's
management and independent auditor that Nortel's internal control
over financial reporting is ineffective, which could continue to
impact Nortel's ability to report its results of operations and
financial condition accurately and in a timely manner; the impact of
Nortel's and NNL's failure to timely file their financial statements
and related periodic reports, including Nortel's inability to access
its shelf registration statement filed with the United States
Securities and Exchange Commission (SEC); the impact of management
changes, including the termination for cause of Nortel's former CEO,
CFO and Controller in April 2004; the sufficiency of Nortel's
restructuring activities, including the work plan announced on August
19, 2004 as updated on September 30, 2004 and December 14, 2004,
including the potential for higher actual costs to be incurred in
connection with restructuring actions compared to the estimated costs
of such actions; cautious or reduced spending by Nortel's customers;
increased consolidation among Nortel's customers and the loss of
customers in certain markets; fluctuations in Nortel's operating
results and general industry, economic and market conditions and
growth rates; fluctuations in Nortel's cash flow, level of
outstanding debt and current debt ratings; Nortel's monitoring of the
capital markets for opportunities to improve its capital structure
and financial flexibility; Nortel's ability to recruit and retain
qualified employees; the use of cash collateral to support Nortel's
normal course business activities; the dependence on Nortel's
subsidiaries for funding; the impact of Nortel's defined benefit
plans and deferred tax assets on results of operations and Nortel's
cash flow; the adverse resolution of class actions, litigation in the
ordinary course of business, intellectual property disputes and
similar matters; Nortel's dependence on new product development and
its ability to predict market demand for particular products;
Nortel's ability to integrate the operations and technologies of
acquired businesses in an effective manner; the impact of rapid
technological and market change; the impact of price and product
competition; barriers to international growth and global economic
conditions, particularly in emerging markets and including interest
rate and currency exchange rate fluctuations; the impact of
rationalization and consolidation in the telecommunications industry;
changes in regulation of the Internet; the impact of the credit risks
of Nortel's customers and the impact of customer financing and
commitments; general stock market volatility; negative developments
associated with Nortel's supply contracts and contract manufacturing
agreements, including as a result of using a sole supplier for a key
component of certain optical networks solutions; the impact of
Nortel's supply and outsourcing contracts that contain delivery and
installation provisions, which, if not met, could result in the
payment of substantial penalties or liquidated damages; any
undetected product defects, errors or failures; the future success of
Nortel's strategic alliances; and certain restrictions on how Nortel
and its president and chief executive officer conduct business. For
additional information with respect to certain of these and other
factors, see the most recent Annual Report on Form 10-K and Quarterly
Report on Form 10-Q filed by Nortel 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.

Contact:

Jose Luis Menoyo, Nortel, Tel: +34-91-709-4567, menoyo@nortel.com;
Angelika Kempf, Nortel, Tel: +44-1628-43-7340,
angelika.kempf@nortel.com; Eman Hussein, Spot On Public Relations,
Tel: +9714-3491686, emanh@spotonpr.com; Pat Cooper, Nortel, Tel:
+1-425-450-7523,
pat.cooper@nortel.com