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Technology Stocks : IDT *(idtc) following this new issue?* -- Ignore unavailable to you. Want to Upgrade?

To: blankmind who wrote (7861)	5/19/1999 12:45:00 AM
From: neverenough	Respond to of 30916

A little info on Net2Phone, NET2PHONE, INC. BUSINESS DESCRIPTION: Net2Phone is a leading provider of voice-enhanced Internet communication services to individuals and businesses worldwide. Our services enable our customers to make low-cost, high-quality phone calls over the Internet using their personal computers or traditional telephones. According to Frost & Sullivan, a leading market research firm, we were the largest provider of Internet telephony services in the world in 1997 with a 30% market share. As of March 31, 1999, we were serving approximately 250,000 active customers and handling over 20 million minutes of use per month. Our revenue has grown substantially, increasing from approximately $2.7 million in the fiscal year ended July 31, 1997 to approximately $12.0 million in the fiscal year ended July 31, 1998. In addition, we had revenue of approximately $13.2 million for the six months ended January 31, 1999. In August 1996, we introduced our first service, "PC2Phone." According to Probe Research, a market research firm, PC2Phone was the first commercial telephone service to connect calls between personal computers and telephones over the Internet. In September 1997, we introduced "Phone2Phone," a service that enables international and domestic calls to be made over the Internet using traditional telephones. Long distance calls made using our services are often substantially less expensive than long distance calls routed over traditional voice networks. USE OF PROCEEDS: $7.0 million of the net proceeds from this offering will be used to repay a portion of a note outstanding to IDT. The balance of the proceeds will be used for the development of strategic Internet relationships, for advertising and promotion, for research and development, for upgrading and expanding our network and for general corporate purposes, including working capital. COMPETITION: The long distance telephony market and, in particular, the Internet telephony market, is highly competitive. There are several large and numerous small competitors, and we expect to face continuing competition based on price and service offerings from existing competitors and new market entrants in the future. The principal competitive factors in the market include price, quality of service, breadth of geographic presence, customer service, reliability, network capacity and the availability of enhanced communications services. Our competitors include AT&T, MCI WorldCom and Sprint in the United States and foreign telecommunications carriers. Many of our competitors have substantially greater financial, technical and marketing resources, larger customer bases, longer operating histories, greater name recognition and more established relationships in the industry than we have. As a result, certain of these competitors may be able to adopt more aggressive pricing policies, which could hinder our ability to market our Internet telephony services. One of our key competitive advantages is the ability to originate and terminate calls to and from the gateway of an Internet service provider, which allows us to bypass the international settlement process and realize substantial savings compared to traditional telephony. Any change in the regulation of an Internet service provider could force us to increase prices and offer rates that are comparable to traditional telephony providers.