Hackensack, NJ -- September 24, 1999 - Net2Phone (NASDAQ: NTOP) has been named the leader in IP telephony services, according to International Data Corporation (IDC).

In IDC's "IP Telephony Services: Market Review and Forecast, 1998 - 2004," released this month, Net2Phone (NASDAQ: NTOP) was named the top IP Telephony Service Provider with 39.4% of the market share in terms of minutes of use. The second largest provider was AT&T Jens (NYSE: T) with 16.4% of minutes. According to the report, IP telephony service revenue is expected to reach $480 million in 1999. Revenue is expected to increase to nearly $19 billion by 2004.IP telephony services internationally will remain the greatest share of the market with 75%, or $17.25 billion of the IP telephony market by 2004.

"This recognition re-affirms Net2Phone's lead in the marketplace. We have achieved this through our strong commitment to providing low-cost Internet telephony while still maintaining exceptional quality and service," said Net2Phone CEO Howard Balter. "We expect to continue to dominate the market."

"The numbers speak for themselves," said Mark Winther, Group Vice President of Telecommunications for IDC and author of the report. "The potential for Internet telephony is great, and Net2Phone has a clear lead in this market due to its vast distribution channels and technological lead."

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 [October 31, 1999] 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.

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