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      Correspondance

        Confidential
          Treatment Requested by SR Telecom Inc.

        August
          26, 2005

        Mr.
          Larry Spirgel, Assistant Director

        Division
          of Corporation Finance

        United
          States Securities and Exchange Commission

        Washington,
          D.C. 20549

        USA

        Subject:        SR
          Telecom Inc.

        Form
          20-F for Fiscal Year Ended December 31, 2004

        Filed
          May 2, 2005

        Forms
          6-K for Fiscal Quarter Ended March 31, 2005

        File
          No. 000-50378

        Dear
          Sirs/Mesdames,

        This
          letter sets forth the response of SR Telecom Inc. (“SRT” or the “Corporation”)
          to the comments set forth in the Staff’s letter dated July 14, 2005 in
          connection with the Corporation’s Annual Report on Form 20-F for the year ended
          December 31, 2004, File No. 000-50378, filed with the U.S. Securities and
          Exchange Commission on May 2, 2005 (the “Annual Report”). For your convenience,
          we have set forth the comments in the Staff’s letter followed by the
          Corporation’s response.

        Form
          20-F for the fiscal year ended December 31, 2004

        Item
          4. Information on the Company

        History
          and Development of the Company, page 12

                  1.

                  We
                    note your disclosure that “SR Telecom USA Inc” was primarily an R&D
                    center, developing and maintaining both the angel
                    and
                    airstar
                    product lines”. Tell us if Netro conducted research and development
                    activities prior to your acquisition and how such-in process
                    research and
                    development costs were accounted for in your purchase accounting.
                    Further,
                    your discussion should demonstrate the differences in accounting
                    treatment
                    under US and Canadian GAAP, if any and site all relevant accounting
                    literature.

        SR
          Telecom USA, Inc., formerly Netro Corporation (“Netro”), was acquired by the
          Corporation in September 2003. Netro was an operating company prior to
          our
          acquisition that had only two product lines, namely Airstar and Angel.
          The
          Airstar product line was developed by Netro whereas the Angel product line
          was
          acquired as part of Netro’s acquisition of assets from a unit of AT&T
          Wireless in February 2002. Netro also conducted research and development
          (“R&D”) prior to the date of acquisition by SRT. The nature of this R&D
          activity was to develop the underlying technology for the Airstar and Angel
          product lines, and there were no other identifiable R&D projects or
          activities. In September 2003, the date of acquisition by SRT, the underlying
          core technologies for each of the product lines was complete. After the
          acquisition by the Corporation, the activities of SR Telecom USA, Inc were
          limited to performing R&D functions to continue to develop the existing
          Airstar and Angel products, such as reducing the cost of the Angel product
          and
          beginning the migration of the Angel product to a pre-WiMAX offering (Symmetry).
          Netro’s former business was in essence “shut-down” after the acquisition and all
          that remained of its operations was the R&D functions as mentioned above.
          All R&D costs incurred by SRT are expensed as incurred. In
          accounting for the acquisition, the Corporation applied SFAS
          No. 141 (“SFAS 141”) and CICA Handbook Section 1581 (“s. 1581”), “Business
          Combinations”
          and EIC-55, “Identifiable
          Assets Acquired in a Business Combination”.
          The Corporation allocated the purchase consideration to the net assets
          acquired.
          The purchase price was below the fair value of the net assets acquired
          based on
          an appraisal report we commissioned for these purposes. The Corporation
          determined that the only separable intangible assets identified were Netro’s
          intellectual property, which resulted from the nature of the existing technology
          comprised of trade secrets and know how.

                  SR
                    Telecom Inc. 8150 Trans Canada Hwy. Montreal QC H4S 1M5 CANADA
• T (514)
                    335.1210 •F
                    (514) 334.7783 • www.srtelecom.com

                  1

        Confidential
          Treatment Requested by SR Telecom Inc.

        At
          the date of acquisition, in the process of valuing the net assets acquired,
          in-process research and development (“IPR&D”) was considered, in accordance
          with FASB Interpretation No. 4 “Applicability
          of FASB No. 2 to Business Consultation Accounted for by the Purchase Method”,
as
          well as the AICPA Practice Aid “Assets
          acquired in a Business Combination to be Used in Research and Development
          Activities: A Focus on Software, Electronic Devices and Pharmaceutical
          Industries”.
          It was determined, with the assistance of our appraisers that no amounts
          were to
          be allocated to IPR&D. The conclusion was based on several factors,
          including the following:

                  •

                  the
                    technology incorporated in the Airstar and Angel products were
                    complete,
                    that is, the technological feasibility of the core technology
                    had been
                    established;

                  •

                  the
                    products were being sold by Netro in the form they were currently
                    in;

                  •

                  tenders
                    for the products in their then current form were
                    made;

                  •

                  SRT
                    immediately was able to sell the products with the underlying
                    technology
                    after the acquisition; that is, no modifications to the core
                    technology
                    was made, and all of which was confirmed by Netro management
                    as of the
                    date of the acquisition.

        The
          negative goodwill in the amount of $7.4M, which resulted from the acquisition
          was allocated on a pro-rata basis to property, plant and equipment and
          to
          intangible assets as described above. SFAS 141 and s.1581 are substantially
          the
          same and thus there were no differences between Canadian and US GAAP in
          accounting for the acquisition.

        Consolidated
          balance sheets, page F-2

                  2.

                  Describe
                    in detail why you believe your reserve for obsolescence is appropriate
                    in
                    light of your declining sales, lower backlog, and delays in the
                    receipt of
                    orders, which continued through March 30,
                    2005.

        The
          process taken by SRT to assess inventory obsolescence included an extensive
          review of sales forecasting, identifying which products are being sold,
          to which
          customers and the time-frame for delivery. The forecasting schedule was
          then
          assessed against inventory in stock as to which items in inventory would
          be used
          in production for fulfillment of orders. In addition, SRT assessed the
          then
          current active bids and potential bids in progress and compared those to
          inventory on hand.

                  The
                    Corporation’s products are core telecommunications network equipment,
                    which are used by the Corporation’s customers as their primary
                    telecommunications access network, connecting the end user to
                    the public
                    switched telephone and data networks. In most instances, this
                    equipment is
                    used by the Corporation’s customers for ten to fifteen years and is
                    subject to many extensions, expansions and upgrades. Historically,
                    unlike
                    many consumer products, the Corporation’s product life cycle is quite
                    long. For example, SR500 product line has been sold in various
                    versions
                    since its introduction in 1987 and the SR500 product that is
                    currently
                    being delivered in Mexico has been sold since April
                    2000.

        Many
          factors contributed to declining sales, lower backlog and delays in the
          receipts
          of orders, which was considered only temporary by the Corporation. Sales
          declined in Q4 2004 and continued to decline in Q1 and Q2 2005 due to SRT’s
          inability to complete sales orders for delivery in the required time due
          to
          reduced supplier credit and refinancing issues that needed to be resolved.
          The
          Corporation in the first half of 2005 focused on the refinancing and
          restructuring of its debentures and US loans as well as obtaining a credit
          facility to fund working capital requirements. During
          this period, management decided to temporarily lay-off employees and shut
          down
          production to a minimal level required to fulfill secured orders.

                  SR
                    Telecom Inc. 8150 Trans Canada Hwy. Montreal QC H4S 1M5 CANADA
• T (514)
                    335.1210 •F
                    (514) 334.7783 • www.srtelecom.com

                  2

        Confidential
          Treatment Requested by SR Telecom Inc.

        Delays
          longer than anticipated in finalizing the credit facility and restructuring
          the
          debentures and US loans also contributed to a lower backlog in Q1 2005.
          The
          refinancing was expected to close in April 2005 and provide funds for additional
          inventory procurement to fulfill and complete such orders. The delay and
          uncertainty surrounding the refinancing and restructuring resulted in delays
          in
          receiving orders, which contributed to a lower backlog. SRT’s backlog has
          however increased to $31.2M at the end of Q2 2005 from $10.4M at the end
          of Q1
          2005. The increase is due to delayed sales orders that were expected in
          Q4 2004
          and Q1 2005 as well as new sales orders received during Q2 2005.

        With
          the credit facility in place in May 2005 and the debentures and US loans
          restructured, management was able to negotiate payment terms with the majority
          of its suppliers and as a result, supplier relations slowly improved, factory
          employees were recalled and production returned to normalized levels to
          deliver
          on contracts awarded. As disclosed in SRT’s second quarter 2005 press release
          and Management Discussion and Analysis, the Corporation expects that revenue
          in
          the third quarter will increase significantly in comparison to the first
          and
          second quarters of 2005.

        Based
          on the above reasons, SRT believes that the inventory obsolescence as a
          percentage of inventory at approximately 16% over the last two years is
          appropriate.

        Tell
          us the nature of the inventory purchased from Solectron, how it will be
          utilized
          in your business, and why you believe the inventory’s cost is less than or equal
          to market.

        The
          Solectron inventory was acquired by SRT, as part of an arbitration settlement.
          Please refer to our response to question 5 for further detail of the settlement
          with Solectron. SRT agreed to acquire all right, title and interest to
          all of
          the inventory (raw materials and component inventory) claimed as excess
          by
          Solectron. The Corporation recorded the inventory at the lower of cost
          and fair
          market value which was assessed at US$4 million, based on the replacement
          cost
          of what these inventory parts were worth on the market. This compares to
          the
          book value of the inventory recorded by Solectron of US$7M. In our assessment
          of
          the inventory value, quotes from brokers were obtained on significant inventory
          items (over 60% of the inventory value was tested). The current replacement
          cost
          for some of the units tested exceeded Solectron’s book value. For these units,
          the Corporation applied a conservative approach and recorded those units
          at
          Solectron’s book value. This was properly accounted for in accordance with the
          CICA Handbook section 3030, “Inventories”.

        The
          Solectron inventory, comprised of raw materials and component inventory,
          is used
          for our Airstar product line, for which at the time of settlement and at
          December 31, 2004, there were sales orders in our backlog and in our sales
          forecast to utilize the inventory. The orders in the backlog for this inventory
          were applied in a simulated computer environment to generate a forecast
          on the
          movement and marketability of such inventory. Based on the testing performed
          and
          our sales forecast, it was identified that there is a future demand on
          the
          inventory received from Solectron.

        7.
          Long-Term accounts receivable, net, page F-16

                  3.

                  We
                    noted that you did not record a provision for your December 2001
                    claim
                    filed against MCI International. It is unclear to us why you
                    believe this
                    amount is recoverable at December 31, 2004 considering MCI’s bankruptcy
                    and subsequent objection to your claim. Tell us in detail why
                    you believe
                    the claim will be upheld by the court and further, why you believe
                    you
                    will receive full payment from MCI
                    International.

                  SR
                    Telecom Inc. 8150 Trans Canada Hwy. Montreal QC H4S 1M5 CANADA
• T (514)
                    335.1210 •F
                    (514) 334.7783 • www.srtelecom.com

                  3

        Confidential
          Treatment Requested by SR Telecom Inc.

        In
          1996, SR Telecom Inc. entered into a contract with Teleco de Haiti (“Teleco”)
          for the provision of wireless telecommunications equipment, which was installed
          in the country, accepted by the customers and is still operating and carrying
          revenue producing traffic for the benefit of Teleco.

        In
          order to secure payment for the telecommunications system, SRT and Teleco
          entered into an agreement with MCI dated September 30, 1996 (and amended
          October
          2, 1996), (the Tripartite Agreement), whereby access charge revenues that