Microsoft, Nortel Transform How People and Businesses Interact with New Joint Unified Communications Solutions

Amid Global Customer Adoption, Companies Deliver on Joint Product Roadmap

REDMOND, WASHINGTON and TORONTO, ONTARIO--(Marketwire - March 11, 2008) - Microsoft Corp. (NASDAQ: MSFT) and Nortel(1) (TSX: NT)(NYSE: NT) today announced the availability of four new joint unified communications (UC) solutions designed to transform how people around the world connect, communicate and collaborate. The joint products include the Converged Office unified communications suite, Multimedia Conferencing, and solutions for branch offices and hosted service providers. Customer adoption continues to accelerate with more than 600 wins for the companies´ unified communications products since the formation of the alliance.

Research indicates that unified communications can improve business productivity by up to 18 percent(3) with up to a 250 percent return on investment.(4) With these new solutions, Nortel and Microsoft have now delivered 10 solutions to market as part of their Innovative Communications Alliance announced less than two years ago.

"With the availability of these latest solutions, Nortel and Microsoft have now delivered on the joint solutions that our two CEOs outlined in January 2007," said Ruchi Prasad, vice president and general manager, Innovative Communications Alliance, Nortel. "With these solutions, enterprises can now choose to deploy unified communications via a customer premise solution, managed service solution, or hybrid of the two, helping accelerate the pace of unified communications adoption."

"Customers and partners recognize the value of joint Microsoft and Nortel solutions and we expect to continue driving the adoption of software-based unified communications solutions in 2008," said Gurdeep Singh Pall, corporate vice president, Unified Communications Group, Microsoft. "In the coming year, we will extend the scope of our unified communications collaboration to include areas such as Contact Center integration and a mix of hybrid and fully hosted UC solutions."

Gartner Inc, the world´s leading information technology research and advisory company, has positioned both Microsoft and Nortel in the Leaders quadrant in the ´2007 Unified Communications Magic Quadrant´ report. To view Gartner´s Magic Quadrant for Unified Communications, 2007(5) click here.

New Solutions

Enterprises can now choose from a broad portfolio of unified communications software and supporting professional services that provide the following competitive differentiators: a single user experience through a common user interface; simplicity and cost-efficiency through a common architecture; flexibility through the ability to implement either on-premise, hosted, or hybrid solutions; and peace of mind through carrier-grade reliability and the ability to support UC capabilities for hundreds of thousands of users.

Since the beginning of the year, Nortel and Microsoft have brought four new unified communications solutions to market as a result of their close collaboration:

- Nortel Converged Office integrates the comprehensive voice functionality of Nortel´s Communication Server (CS) 1000 IP-PBX or CS 2100 IP-PBX with Microsoft® Office Communications Server 2007. CS 1000 is the world´s first and only IP-PBX currently qualified by Microsoft´s Unified Communications Open Interoperability Program(2), providing customers a seamless experience with setup, support, and use of Converged Office.

- UC Integrated Branch extends unified communications to branch office and remote sites. It combines Office Communications Server 2007 mediation server capabilities into the Nortel Secure Router 4134, while integrating WAN routing, Ethernet switching, security and high quality VoIP capabilities into a single cost-effective platform. SR 4134 has been qualified by Microsoft´s Unified Communications Open Interoperability Program, providing customers a seamless experience with setup, support, and use of the joint solution.

- With the Nortel and Microsoft Carrier Hosted Unified Communications Solution, service providers can offer hosted unified communications solutions to SMBs and enterprises using Nortel´s Communication Server 2000 softswitch with Microsoft Office Communications Server 2007 and Exchange Server 2007 Unified Messaging. The solution allows providers to equip workers with instant messaging, VoIP, click-to-call, video conferencing and other multimedia services through Microsoft Office Communicator 2007(2).

- Nortel Multimedia Conferencing 5.0 for Office Communications Server 2007 provides a reservationless audio conferencing solution that enhances Office Communications Server 2007 conferencing with dial in audio bridge capabilities, enabling external non Communications Server 2007 users to dial into a conference.

Through its extensive investment of resources in 2007, Nortel can now provide a comprehensive portfolio of UC professional services that span consulting, assessment and design, testing, deployment and support services. This also includes new advanced services that enable the integration of Microsoft Office Communications Server 2007(2) with existing business applications to create communications enabled business processes. For instance, an employee receiving a customer call on his Office Communicator client can be presented with the recent sales activity from that customer.

Global Customer Adoption

With more than 600 wins for the joint solutions from Nortel and Microsoft since the beginning of the alliance, customers are providing a strong endorsement of the two companies´ software-based approach to unified communications. New joint customers announced today include Ringier AG, Bosowa Corporation, FASA, KMITL and Sandler Travis & Rosenberg, P.A.

Sandler, Travis & Rosenberg, P.A. (ST&R(2)) is an international trade and customs law firm concentrating on providing governments, manufacturers, importers, exporters, retailers, and trade and logistics service providers the information and support they require to meet the constantly changing demands of global trade. The company, which is headquartered in Miami, is deploying Office Communications Server 2007 and standardizing on Nortel VoIP with CS 1000 in 11 offices across the U.S. ST&R is also using Microsoft RoundTable to provide on-demand videoconferencing services.

"Communications is one of our core competencies - if we aren´t effectively communicating with our clients and each other, we can´t operate as business," said Javier D Benvenuti, director of MIS, ST&R. "Microsoft and Nortel´s solution allowed us to address a multitude of productivity and cost reduction requirements with one solution. We will reduce costs by eliminating our third party conferencing service and most long distance fees, and will be able to pass these savings on to our clients. We have estimated a complete return on investment in 10 to 12 months."

The Road Ahead

As the companies look ahead to the next phase of their alliance, they plan to focus attention on delivering solutions which will include:

- Fully Hosted Unified Communications provide the same user experience as the on-premise Converged Office solution in a fully hosted environment for all he UC workloads including voice, presence/IM, conferencing and unified messaging.

- Contact Center Integration: Integrating Nortel´s industry-leading Contact Center application with Office Communications Server to deliver real time multi-modal capabilities enabling new customer touch points, while leveraging rich presence and collaboration capabilities to improve first call resolution and as a result improving the efficiency of communications between agents, supervisors and subject matter experts.

Contacts:
Nortel
Bo Gowan
(214) 334-2474
Email: bogowan@nortel.com
Website: www.nortel.com

Waggener Edstrom for Microsoft
Sarah Warrick
(425) 638-7000
Email: swarrick@waggeneredstrom.com

About Microsoft

Founded in 1975, Microsoft (NASDAQ: MSFT) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

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.

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 from those contemplated in forward-looking statements. For additional information with respect to certain of these and other factors, see Nortel´s Annual Report on Form10-K, 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.

(1) Nortel, the Nortel logo and the Globemark are trademarks of Nortel Networks.

(2) This is a 3rd party link as described in our Web linking practices.

Use of the terms "partner" and "partnership" does not imply a legal partnership between Nortel and any other party.

(3) 2007-2008 Mobile Unified Communications State-of-the-Market Report(2) Dec 2007 by Peter Brockmann and Steven Taylor

(4) Based on Unified Communications ROI Calculator developed on behalf of Nortel with Nemertes Research

(5) Garnter, Inc. "Magic Quadrant for Unifed Communications, 2007" by Bern Elliott, August 20, 2007. The Magic Quadrant is copyrighted 2007 by Gartner, Inc. and is reused with permission. The Magic Quadrant is a graphical representation of a marketplace at and for a specific time period. It depicts Gartner´s analysis of how certain vendors measure against criteria for that marketplace, as defined by Gartner. Gartner does not endorse any vendor, product or service depicted in the Magic Quadrant, and does not advise technology users to select only those vendors placed in the "Leaders" quadrant. The Magic Quadrant is intended solely as a research tool, and is not meant to be a specific guide to action. Gartner disclaims all warranties, express or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

Innovative Communications Alliance Customer Support

Ringier AG

Celebrating its 175 year anniversary, Swiss-based media group Ringier AG(2) has 7000 employees in 10 countries and publishes over 120 newspapers and magazines, produces around 20 TV stations and operates over 50 websites and 11 printing works. After a detailed and successful test phase where the integration between Microsoft Office Communications Server 2007 and Nortel Communication Server 1000 has been tested, the company plans to roll out Office Communications Server CS 1000 across as many as seven locations in a phased deployment.

"We are thrilled with the benefits that Microsoft and Nortel´s unified communications solution can bring to our hectic and dynamic media business." said Hansjoerg Grolimund, project leader & head of operations in Ringier. "The single desktop interface for audio and video, desktop calling, presence and instant messaging provides real value to editors and journalists to work more effectively from anywhere and keep in touch with critical resources at all times. We are convinced that all our employees would benefit from rolling out unified communications throughout EMEA."

Bosowa Corporation

With 30 subsidiary companies and more than 5,000 employees across the Indonesian Archipelago, Bosowa Corporation(2) needed to find a way to bring their employees closer together even when they were spread across many locations. To do this, Bosowa is deploying a unified communications solution integrating Microsoft Office Communications Server 2007 and Exchange Server 2007 Unified Messaging with Nortel CS 1000.

"We believe using unified communications from Microsoft and Nortel provides a compelling glimpse into the future of collaboration, coordination and communication working environments that can bring Bosowa´s employees closer together and change the culture of how they communicate," said Sadikin Aksa, chief financial officer, Bosowa Corporation. "With this unified communications solution, we can capitalize on our existing IT investment and realize the benefits of streamlined communications, greater operational efficiency, and a future-ready IT foundation."

FASA (Farmacias Ahumada S.A.)

Based in Chile, FASA(2) (Farmacias Ahumada S.A.) is one of the largest pharmaceutical companies in South America with almost 1,000 retail pharmacies across the region.

"We are constantly looking to position ourselves as cutting edge in our market. Offering quality service in a globalized market, it is necessary to maintain the levels of efficiency and quality that have always characterized our business," said Eduardo Veliz, engineering director for FASA (Farmacias Ahumada S.A. Chile). "When we decided to incorporate Nortel and Microsoft´s technology, we didn´t do it solely on the solutions we were acquiring, but on the impact that a unified communications solution would have on our processes and results, while helping us to maintain our high standards for efficiency."

King Mongkut´s Institute of Technology Ladkrabang (KMITL)

As one of the largest and most prestigious universities in science and technology in Thailand, King Mongkut´s Institute of Technology Ladkrabang (KMITL(2)) accommodates more than 18,000 undergraduate and postgraduate students across two separate campuses. KMITL is focused on providing quality education and research to advance Thailand´s development in science and technology.

"We needed a better way to help our students learn and connect to our staff and available resources," said professor Akharin Khunkitti, Faculty of Information Technology, KMITL. "Using a Nortel and Microsoft unified communications solution that was integrated by 3DNetworks has transformed the way we communicate and connect with our students. It allows better collaboration between the students and professors and improves the efficiency of our e-learning and teleconferences program. Students are able to gain real-time access to lectures and research databases as well as applying practical usage of technology as part of their learning path, a true learning environment that equips students to work in the real world."

www.nortel.com

www.microsoft.com



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