For Immediate Release: August 31, 1999

BASKING RIDGE, N.J.-- AT&T today announced a contract to provide managed IP networking services and collocation services to Net2Phone, enabling Net2Phone to extend the international reach of its Internet telephony services over AT&T's global network.

Under the terms of the contract AT&T Global Network Services, formerly the IBM Global Network, will provide managed IP networking services so Net2Phone can expand its PC-to-telephone presence to 17 countries, with a dozen other countries under consideration for future expansion. In addition, AT&T will provide collocation services for Net2Phone servers at AT&T's Local Interface Gateway locations (POPs) in those countries.

"We are very pleased to expand our relationship with Net2Phone so its customers will have the benefit of the global reach of our network," said Bruce Jackson, vice president for network services, AT&T Global Network Services. "Voice over IP is one of the fastest growing and exciting services in our industry."

"By effectively utilizing AT&T's robust network and co-locating our IP telephony gateways at their points of presence, we can now offer better service and lower cost to our customers as well as expand our IP scope," said Mordy Rothberg, executive vice president of Net2Phone.

With more than 120 million Internet telephony minutes routed worldwide, Net2Phone's suite of voice over IP services has become an alternative to international long distance. Net2Phone provides PC-to-phone, phone-to-phone, fax-to-fax, and voice-enabled e-commerce solutions to consumers and businesses worldwide. Revenue from the contract is expected to exceed $100 million over the five-year life of the contract.

About AT&T

AT&T (www.att.com) is the world's premier provider of voice and data communications, with more than 80 million customers, including businesses, government and consumers. AT&T runs the world's largest, most powerful long-distance network and the largest wireless network in North America. The company is a leading supplier of data and Internet services for businesses and the nation's largest direct Internet service provider to consumers. AT&T also provides local telephone service to a growing number of businesses.

Sarah Hofstetter
Vice President, Corporate Communications
Net2Phone
201-928-2882
sarah@net2phone.com