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CANNES, France (February 3, 2000) - Nortel Networks (NYSE/TSE: NT), a global leader in network solutions for the Internet, and Phone.com (NASDAQ:PHCM), a leading provider of software for Wireless Internet services, plan to work together to provide end-to-end solutions for Wireless Internet access and services.

Announced in conjunction with the GSM World Congress in Cannes, the companies will explore integration of elements of Phone.coms market-leading WAP (Wireless Application Protocol) products with Nortel Networks IP (Internet Protocol)-based wireless network architecture using GSM (Global System for Mobile Communications) and GPRS (General Packet Radio Service) radio technologies.

The intent is to construct interfaces between Nortel Networks and Phone.com products to achieve optimal implementation of WAP over GPRS. Initially, the companies will target cooperation in the areas of billing, prepaid services, location-based services and `push` information services.

`Network operators will benefit from Nortel Networks expertise in GPRS infrastructure combined with Phone.coms innovative WAP products,` said Jeff Damir, vice-president, business development, Phone.com. `Together, we expect to be able to offer operators a powerful, end-to-end, Wireless Internet solution.`

`Our philosophy is to work with best-in-class solution providers to deliver complete, end-to-end Wireless Internet solutions, helping operators to quickly realize the benefits of investing in GPRS,` said Doug Lowther, vice-president, wireless data solutions, Nortel Networks.

Nortel Networks GPRS solution is based on the widely deployed Nortel Networks Passport and Contivity Extranet switches, each with a rich, proven heritage for providing packet data services. The GPRS radio infrastructure involves a simple software upgrade to Nortel Networks industry leading GSM radio equipment. This total solution can provide significant competitive advantages in service quality and network capacity for data services. Nortel Networks is working with more than 20 GSM and TDMA (time division multiple access) operators worldwide for early deployment of GPRS and EDGE (Enhanced Data for Global Evolution) solutions.

About Nortel Networks
Nortel Networks is a global leader in telephony, data, eBusiness, and wireless solutions for the Internet. The Company had 1999 U.S. GAAP revenues of US$21.3 billion and serves carrier, service provider and enterprise customers globally. Today, Nortel Networks is creating a high-performance Internet that is more reliable and faster than ever before. It is redefining the economics and quality of networking and the Internet through Unified Networks that promise a new era of collaboration, communications and commerce. Visit us at www.nortelnetworks.com.

About Phone.com
Phone.com is a leading provider of WAP software and services that enable the delivery of Internet-based information services to mass-market wireless telephones. Using its software, wireless subscribers have access to Internet- and corporate intranet-based services, including Email, news, stocks, weather, travel and sports. In addition, subscribers have access via their wireless telephones to network operators intranet-based telephony services, which may include over-the-air activation, call management, billing history information, pricing plan subscription and voice message management. Phone.com is headquartered in Silicon Valley, California and has regional offices in Belfast, London, Copenhagen and Tokyo. Visit www.phone.com for more information.

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 impact of price and product competition; the dependence on new product development; the impact of rapid technological and market change; the ability of Nortel Networks to integrate the operations and technologies of acquired businesses in an effective manner; general industry and market conditions and growth rates; international growth and global economic conditions, particularly in emerging markets and including interest rate and currency exchange rate fluctuations; unanticipated impact of Year 2000 issues; and the impact of consolidations in the telecommunications industry. Other potential risks and uncertainties include, but are not limited to: Phone.coms limited operating history: potential fluctuations in Phone.coms operating results; uncertainties related to Phone.coms long sales cycle and reliance on a small number of customers; Phone.coms dependence on the acceptance of its products by network operators and wireless subscribers; Phone.coms ability to adequately address the rapidly-evolving market for delivery of Internet-based services through wireless telephones; the need to achieve widespread integration of Phone.coms browser in wireless telephones; competition from companies with substantially greater financial, technical, marketing and distribution resources; and the ability of Phone.com to manage a complex set of engineering, marketing and distribution relationships. For additional information with respect to certain of these and other factors, see the reports filed by Nortel Networks with the United States Securities and Exchange Commission. Nortel Networks disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Further information regarding these and other risks is also included in Phone.coms Form 10-Q for quarter ended September 30, 1999, in its prospectus dated November 16, 1999, and in its other filings with the Securities and Exchange Commission.

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For further information:

Contact Phone.com Worldwide Public Relations:

Nortel Networks
Olivier Le Friec
+33 (1) 39 44 38 95
[email protected]

Springbok Technologies
Tori Van Orden
+1 972-480-9458
[email protected]

Nortel Networks
Jeff Ferry
+1 703-712-8339
[email protected]