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KPN AND TELEFONICA WHOLESALE SIGN TO INTERCONNECTTHEIR DATA NETWORKS

Telefonica International Wholesale Services and KPN, two of Europe's leading telecommunications carriers, have signed today an agreement to enable the interconnection of their international data networks.

This Agreement will enable both companies to increase their international coverage creating a seamless international network for their clients, encompassing practically all of Latin America and Europe.

Telefonica Wholesale will extend its coverage through KPN's Eurorings in Europe, while KPN will extend its coverage in Latin America through Telefonica's network. The complimentary nature of these networks will provide significant benefits to customers of both companies who will align their sales and marketing activities to enhance delivery of their networking solutions.

The partnership between Telefonica Wholesale and KPN will now enable them to offer corporate customers a one-stop service with seamless, reliable and secure connectivity, and fully-managed networking solutions across the USA, Latin America and Europe.

Mr. John van Vianen, Director of KPN's Business Unit for Connectivity said, "We are delighted we can now offer our customers this important extension of our network coverage with a leading partner like Telefonica. It adds value to our partnership by combining an extensive infrastructure in Southern and Central America with their expert knowledge and understanding of the telecom market in Latin America. The fact that both networks use MPLS means we can give our customers the quality they need for converged services like Voice over IP (VoIP) or video conferencing."

Mr. Carlos Mariñas, CEO of Telefonica International Wholesale Services, stressed the importance that "since our customers' service needs remain as they go global, regardless of their geographical location, we have to keep our growth stride to satisfy their always demanding needs, wherever they are. As recent operations have shown we're still focused on the European Market. This partnership with KPN, sharing the same market vision and quality of service requirements, will fully match our customers' connectivity needs."

About KPN (to be updated)

KPN's international network is a state-of-the-art data/IP backbone with a seamless footprint extending across major business and financial centers in Europe. KPN's EuroRings portfolio

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