Unlike other Internet telephony providers, Net2Phone Direct routes calls over its own private IP network, enabling better quality of calls as well as least cost routing opportunities. Net2Phone's network currently reaches 30 countries and expects to be operational in 25 additional countries by the end of the year. Net2Phone expects to launch similar services in Canada, Germany, France, Hong Kong, Australia, and Japan over the next few months.

Net2Phone's services dramatically cut the cost of placing international calls to most areas in the world. Currently, Net2Phone offers PC-to-phone/fax calling from any Internet-ready multimedia PC to any telephone or fax machine in the world at reduced rates. Net2Phone also offers free real-time PC-to-PC calling worldwide. The advent of Net2Phone Direct to the European market enables low-cost traditional calling using an ordinary telephone over the Internet.

"Net2Phone has always prided itself on the ability to capitalize on new opportunities, and offering international phone-to-phone from the UK is an excellent way for Net2Phone to expand our services, increase and diversify revenue, and strengthen our customer base," said David Greenblatt, Chief Operating Officer of Net2Phone. "Our call quality often exceeds that of traditional calling, and now it's easier than ever to offer user-friendly and low-cost services to our users around the world."

How it Works: Users dial a local phone number, which connects the call to a local gateway in the UK, which digitizes the caller's voice and puts it onto Net2Phone's network. The system then prompts the user to enter the account number and the telephone number they wish to reach. The call is then carried over Net2Phone's network to another gateway located close to the recipient's area, which switches the call onto the local telephone network, and completes the call -- all within seconds. Rates are on average 50% less than traditional calling with prices starting at approximately £0.05 per minute on calls to the U.S. Billing will be done in U.S. dollars.

According to International Data Corp. (IDC), the biggest opportunity for IP telephony service providers is international communications. IDC recently reported that Net2Phone has 39.4% of market share of Internet telephony minutes routed.

Those interested in signing up for the Net2Phone Direct pre-paid calling card can either visit www.net2phonedirect.com or call 0171-549-9009. The Company is offering a promotion of $5.00 of free calling time upon initial purchase.

Net2Phone is a leading provider of voice-enhanced Internet communications services to individuals and businesses worldwide. Net2Phone enables people to place low-cost high quality calls from their computer, telephone, or fax machine to any telephone or fax machine in the world. Net2Phone develops and markets technology and services for IP voice and e-commerce solutions for the web and other IP networks. For more information about Net2Phone's products and services, please visit www.net2phone.com.

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements include, among other things, Net2Phone's expected operating performance for the three months ending January 31, 2000 and thereafter. Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others, the inherent uncertainty of financial estimates and projections, the competitive environment for Internet telephony, changes of rates of all related telco rates and services, legislation that may affect the Internet telephony industry, and Net2Phone's ability to operate the services described on a large scale commercial level.The forward-looking statements are made as of the date of this press release, and Net2Phone assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Investors should consult all of the information set forth herein and the other information set forth from time to time in Net2Phone's reports filed with the Securities and Exchange Commission pursuant to the Securities Act of 1933 and the Securities Exchange Act of 1934.