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To: Larry S. who wrote (50418)	1/7/2004 4:44:22 PM
From: Venkatesh Nakkala	Read Replies (1) \| Respond to of 53068

you can see the release in the news, but basically Verizon is starting to replace their traditional central office switches with packet switches ... after a trial they did in 2002 with NT VOIP...this is the first major contract for all the bells that have to convert over the next few years from their traditional switches to a more converged networks... some of the news media have been saying that Lucent still has ways to go with its softswitches (otherwise typically big companies like Verizon give out contracts to both LU and NT ..like $1 billion to NT and $1 billion to LU)...and verizon is apparently LU turf (in terms of their traditional switches).... they dont have any numbers in terms of $$$ for this contract, but it could be over $2 billion.... Please note these are just my opinions here.... hope this helps....basically over hte next few years, most of the bells and long distance carriers have to upgrade their switches to VOIP...CSCO has a solution thru their Routers, but it could be more economical for carriers to leverage their existing switching equipment by using a NT type solution...also SONS type solutions require a replacement of the traditional switches with SONS switches (again probably more expensice)...notice SONS dropped by .90 today..... VOIP is really big, India's Reliance company gave a $400 million contract to CSCO recently.... Again, these are all only my opinions, Venkatesh

To: Larry S. who wrote (50418)	1/8/2004 7:55:36 AM
From: Ron McKinnon	Respond to of 53068

fyi 07:53 NT upgraded at Deutsche to Buy (5.68 ) Deutsche upgrades Nortel to Buy from Hold with a $6.85 price target. The upgrade is based on the belief that Nortel will take market share, expand margins, and drive additional earnings power within its business going forward. The firm says it's a bit sheepish about upgrading the stock on top of its recent run. Nonetheless, the firm believes the stock, over time, can trade up from current levels enough to merit a Buy rating. The new target is based on a target earnings multiple on 2005E EPS of 38x which is in line with current valuations for Tellabs and Lucent -- cos the firm views as less interesting fundamental performers than Nortel