Hackensack, NJ - May 23, 2000 --- Net2Phone Inc. (NASDAQ: NTOP) today announced that CompUSA Inc. will distribute the Company's new YAP (Your Alternative Phone) Internet telephony product line in retail outlets nationwide.

Starting this weekend in all CompUSA Computer Superstores, YAP products will make Internet calling easier than ever before. The YAP line consists of a series of Internet telephony hardware products designed to enhance Internet calling with and without a PC. Products are available for both consumers and businesses and enable all users to save significantly on long distance costs. All YAP products come with both hardware and free calling time.

CompUSA will market YAP products through its circulars nationwide as well as through prominent positioning in the stores. CompUSA will devote a customized end-cap to feature multiple YAP products.

John S. Lostroscio, VP of Merchandising for CompUSA Inc. said, "We are excited about offering YAP products to our customers around the country and believe they will appreciate the cost savings and value-added functionality of Internet calling. Now even customers without computers can start making phone calls over the Internet."

"With the help of CompUSA, Internet telephony has now reached a great milestone," said Jonathan Rand, Executive VP of Net2Phone and Director of YAP. "Distributing YAP through CompUSA's national network will offer millions of computer users with multiple ways to save money on phone calls. This gives us a tremendous opportunity to begin off-line marketing to computer users right at the point of the PC purchase."

CompUSA will distribute the following YAP products:

• YAP Headset: Plug the YAP Headset into the back of a computer for clear transmission of Internet telephony calls.
• YAP Phone: Install the Net2Phone software and plug the handset into the multimedia soundcard of your computer.
• YAP USB Hotline: Use your regular phone to place cost-saving calls over the Internet. Simply plug your regular phone into the YAP USB external interface that in turn connects to the USB port on your computer.
• YAP ISA Hotline: Plug a regular phone into the YAP Port ISA card that installs in an open ISA slot on your computer. All voice compression and echo cancellation takes place off the Windows network, and allows for clearer transmission of calls.
• YAP Jack: Plug an ordinary telephone into the YAP Jack to use the Internet for toll-quality and natural phone conversations. Users do not need a PC to make calls. Instead, Net2Phone places the call using an Internet Service Provider and then routes the call over the Internet.
• YAP Multimax: Corporate users can leverage or extend the capacity of an Internet line into the equivalent of up to 6 lines, each of which capable of making and receiving calls, faxes, etc. while simultaneously maintaining a persistent Internet connection.

Net2Phone plans to unveil more YAP products by the end of the year, including solutions for Voice over DSL and Voice over IP for Cable.

CompUSA Inc. (www.compusa.com) is one of the nation's leading retailers and resellers of personal computers and related products and services. CompUSA Inc. currently operates 218 CompUSA Computer Superstores in 84 major metropolitan markets across the United States that serve retail, corporate, government and education customers and include technical service departments. Many of the stores include classroom training facilities. CompUSA also offers its own build-to-order personal computer series, the CompUSA PC(TM).

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 April 30, 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.