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To: zbyslaw owczarczyk who wrote (32321)	2/14/2000 5:05:00 PM
From: telecomguy	Respond to of 77399

Good reflection of what's happening in the field right now as we "speak"? Telecomguy OTTAWA (Reuters) - Nortel Networks Corp., one of the world's largest communication equipment makers, said Monday it will spend $260 million and hire 3,400 staff to meet blistering demand for its fiber-optic network gear -- just three months after announcing a $400 million expansion. Nortel now forecasts 30 percent growth in its production of fiber-optic products in 2001, up from the $10 billion that Nortel said it will ship to customers in 2000. ``The $10 billion number that we've quoted is what we expect our revenue in optical systems to approach... and that is a production-limited number,' said Nortel Chief Executive John Roth in a conference call with media and analysts. ``Demand from our customers is actually in excess of that.' Nortel said Monday that it will spend about $64 million on two facilities in England, at Paignton and Monkstown, adding 900 jobs. In Ottawa, $102 million will be invested and 1,000 more jobs created, and in Montreal an $84 million expansion will add almost 1,000 jobs. Other Nortel facilities will see about $10 million in spending and 450 new jobs. Globally, 3,400 positions will be created in manufacturing, engineering, supply-chain management and customer service. ``In total, within a three-month period, we will have invested about $660 million, in excess of 8,000 jobs, all to service Nortel's rapidly growing optical business,' Roth said. ``This expansion will result in an approximately 30 percent increase over and above the increases we announced last fall -- which were about a six-fold increase in our ability to produce optical systems.' Nortel's previously announced expansion will be in place by this summer. The expansion announced Monday is likely to be complete by year's end. Some analysts have said that Nortel has suggested during its roadshows that optical sales could surpass projections of $10 billion by $2 billion to $3 billion. ``To the degree that we can over-achieve our capacity-increase plan, we'll in fact maybe do better than the $10 billion,' Roth said during the call. ``But at this point that's a pretty aggressive number as it is.' The expansion signals sustained strength in Nortel's optical network sales, said John Wilson, analyst at Bunting, Warburg Dillon Read in Toronto. ``It's just booming, booming, booming,' he said. ``We've been hearing for a while on this roadshow that they've been talking about doubling again of capacity...when you're doing that, you're just basically flat out, booming.' Nortel shares rose to C$176.95 on the news Monday morning before pulling back to C$172 on the Toronto Stock Exchange, a gain of C$1.25. In New York, the issue moved up to 121-3/4 then slipped to 118-3/8, a gain of 1/8. Two other announcements also helped lift its shares. Nortel said Monday it had struck a sales deal with GTE Corp. for fiber-optic equipment that can carry up to 160 gigabits of data per second in metropolitan areas. It is the first major sale since Nortel purchased that technology from Newbridge Networks Corp. affiliate Cambrian Systems Corp. in December 1998. GTE said it will offer advanced optical services in metropolitan centers in Washington, California, Virginia, and Florida. Nortel also announced a broad patent cross-licensing agreement with Tellabs Inc., which sells voice and data network systems, in which the two firms will have rights to each other's patented technology including optical networking gear. Nortel did not disclose the net royalty it will receive under the deal.