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Nortel chief urges U.S. to promote broadband use

January 13, 2005 By Staff

Copyright 2005 Toronto Star Newspapers, Ltd.

The Toronto Star

January 14, 2005 Friday

From Lexis Nexis

Nortel Networks Corp. chief executive Bill Owens criticized U.S. policy in deploying broadband yesterday, saying the U.S. risks being eclipsed by competitors, especially in Asia.

“I don’t know if we’re up to this as a nation,” Owens said at a broadband forum on Capitol Hill, adding that the resources are there, “but for some reason we don’t do it.”

According to the International Telecommunications Union, the U.S. was 11th in 2002 among major economies in broadband use, trailing Hong Kong, Canada, Belgium and others.

“We don’t have our minds in the highest levels of government” focused on broadband, said Owens. In places like China, “they know that they’re going to win and they have a plan.”

Nortel is sensitive to investment in areas like broadband and fiber optics, and Owens stressed, “Nortel will grow. We are through our restatement, I assure you.”

Tuesday, Nortel filed financial restatements for 2003 to resolve accounting errors. It also said that 12 executives volunteered to pay back bonuses amounting to about $8.6 million (U.S.) and announced the creation of a new position of chief ethics and compliance officer.

According to Federal Communications Commission data, high-speed broadband use in the U.S. increased 15 percent during the first half of 2004 to a total of 32.5 million lines.

And FCC Commissioner Kathleen Abernathy, speaking at the same event, said “there absolutely is (a broadband policy) at the FCC.” She cited several recent FCC decisions to promote broadband such as facilitating broadband via power lines and policies to make it easier for phone firms to invest in fiber to homes and neighborhoods.

Separately, Nortel said in a filing that chief ethics officer Susan Shepard will receive a $375,000 salary and be eligible for an annual bonus of 60 percent of her base salary.

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