1. Stephen Sweet Director, Business Development

2. Where are we now?

3. VoIP Market Evolution Market Opportunity Newly minted carriers Under-financed Little operating experience Taking advantage of toll bypass Opportunities & low barriers to entryl Aggregators ITXC, iBasis, Net2phone Fiber barons moving into value added services in search of elusive profits. Global Crossing, Level3, etc. Established carriers making transition. Private vs. Public IP networks CLECs, LECs, ASPs, Web based portals.

4. Growth of International Carriers Source: Telegeography 2003 International Carriers

5. Competition = Lower Prices Wholesale Rate – China Proper 2000 - US $0.32 per minute 2003 - US $0.013 per minute

6. Optical Amplification WDM DWDM Capacity per fiber: 1990 - 2000 Optical Amplification WDM DWDM Source: Telegeography

7. Voice Commoditization Source: Telegeography

8. International Re-file Market 1996 - 1.8% of World Traffic 1997 - 4.2% of World Traffic 1998 - 6.4% of World Traffic 1999 - 9.5% of World Traffic 2003 – 25 - 30% of World Traffic Source: Telegeography

9. Wholesale Rates F.o.B. New York

10. Relative Price Declines F.o.B. NY (12 Months)

11. Industry inefficiencies

12. AgricultureLumberPaperChemicalsTrucking & warehousing Insurance carriers Business services Telecom services Products 10% SG&A % of revenue in U.S. Industry 14% 12% 19% 25% Services Outsized Telecom SG&A Expenses Weighted average

13. Telco2 Telco3 elco4 Telco6 Telco5 Telco1 Identify counter party Negotiate Evaluate credit risk Execute contract Provision Interconnect Test quality Routing Billing Reconciliation Dispute resolution Settle Reciprocal Interconnection Bottleneck 2,800 Carriers equal 3,918,600 interconnects 3,918,600 contracts 3,918,600 settlements 6 Carriers equal 15 interconnects = n * (n-1) 2 Telco 1 Telco 2 Telco 3 Telco 4 Telco 5 Telco 6

14. Thexchange solution

15. Thexchange Model Web-based Exchange Originating carrier Web-based trading & dynamic routing on per-call basis One connection One contract Telecom Switch OSS Terminating carrier Call originators (buys) Call terminators (sells)

17. Automated LCR

18. 1,000 Destinations e.g. Mexico current proper market Originating Carrier Proper Rate $0.0895 e.g. Mexico blended breakout Originating Carrier Blended Rate $0.0830 Merida - $0.0676 La Paz - $0.0808 Cancun- $0.0674 Leon - $0.0330 Veracruz - $0.0630 Terminating Carrier Breakout Routing Delivers 6% to 20% Price Improvement

19. Gross revenue Terminatio n costs Network operations Gross margin SG&AEBITDA Lower termination cost through breakout routing Higher utilization and fewer route changes through spot market Increase revenue & reduced costs boost Gross Margins Reduce sales, billing, reconciliation, legal, bad debt expenses Improved EBITDA margins Access to centralized mkt & better port availability increases revenue opportunities Base Costs Decreases Increases Legend thexchange Impact

20.  12 consecutive growth quarters  More than 250 Members  12 of the world’s 15 largest carriers  8 billion minute run rate  24 million minutes per day Market Acceptance Minutes (millions) - 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 Q2 2000 Q3 2000 Q4 2000 Q1 2001 Q2 2001 Q3 2001 Q4 2001 Q1 2002 Q2 2002 Q3 2002 Q4 2002 Q1 2003 Q2 2003

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