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  Carolyn Robertson
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Arbinet-thexchange Posts 10th Consecutive Quarter of Growth with Membership up to 250; Minutes Nearly Triple

NEW YORK – January 15, 2003 – Arbinet-thexchange, the full-service trading solution for buyers and sellers of voice minutes, said its 4th quarter was its 10th consecutive quarter of growth. Trading was up 282%, at 5.02 billion minutes in 2002, compared to 1.78 billion minutes in 2001. In addition, Membership on thexchange has grown to more than 250 Members, currently trading at an annual run rate of nearly 6 billion minutes, powered by the company’s record 490 million minutes in December.

Launch of Los Angeles Exchange Delivery Point [EDP] Expands Access to Members

In March thexchange inaugurated service on its new carrier grade switching platform, located at 611 West 6th Street in Los Angeles, CA. The Los Angeles EDP is connected to the One Wilshire “meet-me-room.”

Central to the advantages the Company offers the world’s telecommunications carriers is the proposition that connection at any EDP provides them access to all other Members on thexchange, regardless of where those Members themselves are connected.

CreditWatchsm monitoring system Provides Members with Bankruptcy Insulation

In April thexchange introduced the CreditWatchsm monitoring system to automate the credit management process. The new feature enables selling Members to limit exposure to bad debt, while providing a streamlined, secure and efficient marketplace for wholesale voice minute transactions. The Company sets a credit line for every buying Member and underwrites the line with an outside insurer. Members can alternatively secure the credit line by deposit.

The CreditWatchsm system, which monitors net trading balance in real time, automatically warns the Member as it approaches its limit and then suspends the Member’s ability to buy as it reaches its limit.

Introduction of MarketTraksm daily trading report Improves Visibility

Also in April thexchange began sending its Members the MarketTraksm daily trading report, which provides detailed information about the volume traded and the price and quality for each matched order in every market on thexchange.

The daily trading report’s information, which helps buyers and sellers better understand markets and improve margins, has quickly become the Company’s most important reporting tool. A seller can price up to the buyer order that sends bulk minutes on a route. A buyer can see the price/quality benchmark of the sellers that complete the greatest volume on a route.

Peak/Off-Peak Trading Lets Members Benefit from Network Utilization Patterns

Peak/Off-Peak Trading, which was introduced by thexchange in January, allows Members to buy and sell termination at different rates during peak, off-peak and weekend time slots. This is particularly advantageous for European mobile markets that have high peak termination rates and deep off-peak and weekend discounts. The Company’s software automatically routes a buyer’s traffic for an eligible market to a lower priced off-peak or weekend seller for termination. A buyer for these destinations automatically receives a lower blended rate, and an off-peak or weekend seller can tap a large source of minutes to optimize its network utilization.

Online Invoicing Gives Members More Information More Quickly

Finally, in December thexchange debuted its online invoicing system for U.S. Members. The system, which will be available to U.K. Members in the first quarter of 2003, provides Members with the ability to view and download invoices the day they are created. The call detail summary can be downloaded as a Comma Separated Value (.csv) file that is easily imported into the majority of spreadsheets, databases and financial software. In addition, an invoice archive allows each Member to view any of its electronic invoices for up to one year.

Management Commentary

“As carriers continue to right-size the number of interconnections they have with their suppliers, Arbinet-thexchange is the trading partner they now rely on to aggregate this supply,” says J. Curt Hockemeier, President and CEO at Arbinet-thexchange. “This is driving the Membership increase we are seeing and the greater adoption by carriers on thexchange.”

“While the scale of thexchange has changed, the reasons our Members trade here remain the same,” says Bill Haner, thexchange’s senior vice president of worldwide sales. “Our trading platform, which shields Members from the financial impact of bankrupt buyers and reduces working capital requirements by paying faster, benefits all Members. Sellers are able to capture additional revenue with minimal investment, and buyers receive the best termination value in the industry from the spot market.”

About Arbinet-thexchange

Two processes central to all telecom companies are selling access to their networks and routing calls off their networks to destinations worldwide. Arbinet-thexchange has created the spot market and designed and built the world’s most advanced system to automate anonymous minutes trading between telecom companies. More than 250 Members, including eight of the ten largest international telecom carriers, use thexchange to reduce their cost of service, improve route quality and expand revenues by reaching new markets without extensive network build out.

Thexchange’s Members input trade parameters and the system automates sales and purchase order execution, complex calling code matching, call routing to specific breakout destinations and manages the quality of service of traded capacity. The system also handles the credit risk management, billing and commercial settlement aspects of these transactions. Arbinet-thexchange also distributes spot market transaction data that provides carriers with reliable pricing, quality and routing information for use in planning and negotiations. These products include AXCESSCODEsm international calling code breakouts.

For more information, visit Arbinet-thexchange at

120 Albany St. Tower II, Suite 450, New Brunswick, NJ 08901
phone: 732-509-9100, fax: 732-509-9101, website:

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