Net2phone and Callwave Announce Strategic Alliance to Develop Complete Inbound and Outbound call Handling over IP
Integrated products and services to be cross-marketed to a combined customer base of over 5 million users

Newark, NJ and Santa Barbara, CA, November 20, 2000 - Net2Phone (NASDAQ: NTOP) a leading provider of voice-enhanced Internet communications services, and CallWave, the largest provider of Internet Call Waiting, today announced a strategic alliance to develop and cross-distribute the first services which integrate inbound and outbound voice over IP targeted at both individuals and businesses.  

The companies have combined efforts to lead the next stage of innovation in voice over IP applications. Under the agreement, CallWave will integrate a Net2Phone-branded version of its free Internet Answering Machine into Net2Phone’s product line. The integration will enable users to return a call while online with a single click. In addition, Net2Phone will provide CallWave-branded versions of its outbound calling services, including free domestic and paid international PC-to-Phone for outbound calls, and paid calling cards.

“CallWave’s Internet Answering Machine has become the standard by which consumers can hear who’s calling while surfing the Internet, without the expense or hassle of having a second phone line,” said Howie Balter, chief executive officer of Net2Phone. “At four million registered users, CallWave has the momentum and proven softswitch platform to deliver reliable and scalable inbound call management that will leverage Net2Phone’s network and complement Net2Phone’s industry-leading outbound calling services.”

“Net2Phone is a leader in the Voice over IP industry, and we share their vision of making IP telephony not only cost effective, but easier and more powerful than the old phone network,” said Dave Hofstatter, president of CallWave. “This alliance will accelerate the already rapid adoption of Internet-based telephone services by individuals and businesses.”

Internet Call Waiting has emerged as a compelling new voice application, and is driving the VoIP industry beyond the core business of reducing long distance rates. In just one year, CallWave’s Internet Answering Machine has become the single most widely used Internet-based answering service. Callwave has 64 percent more monthly unique visitors than all of its competitors combined according the Media Metrix.*

About CallWave
CallWave’s virtual phone lines are a free alternative to costly second phone lines. The company’s Internet Answering Machine enables consumers who utilize one phone line for both voice calls and Internet usage to hear who is calling while they are online. CallWave also offers a fax-to-email service. Available nationwide, the simple and reliable services can be downloaded with just two mouse clicks and installed in minutes. Visit www.callwave.com to learn more about this Santa Barbara-based company.

About Net2Phone
Net2Phone, Inc. 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. Net2Phone's strategic investors include Softbank, America Online, GE/NBC, and Yahoo!. Additionally, AT&T has acquired a 39 percent voting stake in Net2Phone. For more information about Net2Phone's products and services, please visit www.net2phone.com

*Based on comparisons using September 2000 Media Metrix Digital Media Report. The competitive set consists of all competitors that show up in the Media Metrix report that includes Evoice, BuzMe and Pagoo.

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, 2001 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.