Nortel to invest $US400M in optical networking

Nortel Networks is investing another $US400 million in fibre optical networking, with plans to expand existing facilities in the UK and Northern Ireland and to build a new facility in Ottawa, Ontario.

Nortel expects to create about 5,000 jobs in its optical business and to triple its production capacity next year, said John Roth, Nortel president and chief executive officer, yesterday. The intent is to place Nortel in the lead among fibre-optic network companies, he said.

Fibre "makes communications cheap," Roth said. "We're now talking about pennies a minute for long distance and it's going to continue to drop."

Nortel's global plan is a key component of Canada's goal to become "the most connected nation in the world," said John Manley, the minister of industry for Canada, who also spoke at the press conference. The advent of fibre optics is "what moveable type was to processes that preceded the Gutenberg press," he said.

The plan outlined yesterday includes:

-- An investment of $143 million in Ottawa, including construction of a 125,000 square-foot facility; $82 million in Montreal; $105 million split between the UK and Northern Ireland, and $70 million mostly in the US. Nortel will expand in Paignton, UK, and Monkstown, Northern Ireland, move into a new facility in Montreal and boost supply chain and customer-service ability in Atlanta and Raleigh, North Carolina. Expansion is slated for completion by the middle of next year.

-- Creation of some 5,000 full-time jobs in systems integration and testing, engineering, customer service and supply-chain management. Ottawa will gain 850 of those jobs, with 1,450 in Montreal, 1,800 split between Paignton and Monkstown and 900 in other locations, including the US.

-- The planned investments will be spent on production of optical systems and components, including lasers, high-bandwidth receivers and high-speed electronic circuits.

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