"Net2Phone is clearly the trend-setter in the Voice over IP retail market. It is a company that the analyst community as well as other market participants are keeping a close eye on in anticipation of its next move," said John Cha, Industry Analyst for Packet Telephony and Voice/Data Convergence. "Net2Phone has positioned itself as the leader in the IP telephony services market through its flagship PC to Phone product.

"Net2Phone's visions to make PCs a standard telecommunications device led to innovative e-tail business solutions, effective branding strategies, and strategic partnerships to take advantage of the tremendous opportunity in the IP telephony market.

According to Frost & Sullivan's report on Global IP Telephony Service Markets, "Net2Phone's strategic partners, which include AOL, Compaq, and Prodigy will help Net2Phone maintain their leadership position in the IP telephony retail market. Net2Phone will continue to increase traffic on their network through innovative products such as Click2Talk."

Net2Phone has also received commendation from IDC as the leader in Internet telephony minutes routed in their August 1999 report on Voice over IP services and were listed in the Top 25 Companies of the Silicon Alley Network. The Company's PC-to-phone service recently was awarded Product of the Year by Internet Telephony Magazine.

"We are honored to be recognized as the world's leader in Internet telephony services by experts who continue to validate our early entry into the marketplace with leading edge products and services," said Howie Balter, CEO of Net2Phone. "Through continued expansion internationally, we expect to continue to be the dominant player in IP telephony worldwide."

Frost & Sullivan is an international marketing consulting and training company that monitors the telecommunications industry for market trends, market measurements and strategies. This ongoing research is used to complement a series of research publications, such as no. 5855-61 World IP Telephony Equipment Markets, and is used to support participants with customized consulting needs. Free executive summaries are available to the press.

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.