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iBasis Launches DirectVoIP Broadband Interconnection Service

New Service Simplifies International VoIP Service for Voice over Broadband Providers

BURLINGTON, MA— January 24, 2005 — iBasis, Inc. (OTCBB: IBAS), a leader in international long distance, VoIP, and prepaid calling cards, today announced DirectVoIP™ Broadband, a new service designed for providers of retail telephone services that operate over broadband IP connections, such as cable modems or digital subscriber lines (DSL). DirectVoIP Broadband enables voice over broadband providers to quickly connect to the iBasis global VoIP network to offer high quality international voice service to retail customers. Retail voice over broadband service is one of the fastest growing segments in worldwide telecommunications. DirectVoIP Broadband provides the security, scalability and quality broadband service providers require, making it possible for them to deliver retail international voice services at competitive prices without a large capital investment in infrastructure. Combined with iBasis' PremiumCertified™ international routing service, DirectVoIP Broadband offers a complete solution for high quality retail voice over broadband service.

"With the dramatic growth in worldwide adoption of broadband, the growth potential for voice over broadband services appears to be tremendous," said Ofer Gneezy, president and CEO of iBasis. "By providing cost-efficient interconnections to our global VoIP network with DirectVoIP Broadband, as well as high quality international call completion through our PremiumCertified™ service, iBasis helps providers of these services grow their customer base rapidly and increase average revenue per user."

"iBasis is a first rate partner in delivering interconnections and handling large volumes of Skype's Internet telephony terminations to the traditional PSTN network," said Niklas Zennström, Skype's CEO and co-founder. "We appreciate iBasis's expertise in delivering innovative new solutions and efficiencies, and we look forward to continued joint success in expanding the consumer adoption of Internet telephony worldwide."

With DirectVoIP Broadband, VoIP deployments are completed and activated in a matter of days in contrast to the more typical weeks-long lead times for traditional interconnects with TDM carriers. DirectVoIP Broadband also facilitates operational support, making IP interconnects easier to maintain and monitor for high quality of service.

A Global Network & Regionalized Architecture

The iBasis global VoIP network comprises Internet Central Offices—regional hubs and ingress points -- on each continent where broadband service providers can interconnect via DirectVoIP Broadband and immediately expand their reach. These distributed facilities provide support for multiple protocols and devices, network-to-network SIP authentication, and trans-coding capabilities using SIP proxies, Session Border Controllers, and trans-coding systems within the network ingress points.

Cost-Effective and Scalable Interconnects

iBasis DirectVoIP Broadband enables service providers to reduce the capital and operating costs required for international voice services. DirectVoIP Broadband interconnections allow cost-effective and scalable VoIP interconnects to carriers and providers, eliminating the need for increased capital expense associated with fixed TDM circuits, local loops, digital cross-connect switches and gateway ports in global interconnect facilities and data centers.

SIP and H323 Protocol Capable—Enhanced Interoperability

DirectVoIP Broadband leverages iBasis' extensive VoIP interoperability capabilities in supporting a broad range of VoIP infrastructure equipment, including multi-vendor gateways, gatekeepers, proxy servers, session border controllers, softswitches, IP phones and PC-Phone applications that have been DirectVoIP Certified. DirectVoIP Broadband also provides enhanced call signaling control and conversion using standards-based protocols such as SIP and H.323 thus allowing a large array of IP phones and PC-Phone applications to operate effectively with the iBasis network.

Additional information about DirectVoIP Broadband is available at www.ibasis.com/services/DirectVoIP.htm.

About iBasis

Founded in 1996, iBasis (OTCBB: IBAS) is a leading wholesale carrier of international long distance telephone calls and a provider of retail prepaid calling services, including the Pingo™ (www.pingo.com) web-based offering and disposable calling cards, which are sold through major distributors and available at retail stores throughout the U.S. iBasis customers include many of the largest telecommunications carriers in the world, including AT&T, Cable & Wireless, China Mobile, China Unicom, MCI, Sprint, Telefonica, Telenor, and Telstra. iBasis has carried more than ten billion minutes of international VoIP traffic over its global Cisco Powered™ network, and is one of the ten largest carriers of international voice traffic in the world1. For three consecutive years service providers have named the Company as the best international wholesale carrier in ATLANTIC-ACM's annual International Wholesale Carrier Report Card2. iBasis was also ranked the #1 fastest-growing technology company in New England in the 2002 and 2003 Technology Fast 50 programs sponsored by Deloitte & Touche. The Company can be reached at its worldwide headquarters in Burlington, Massachusetts, USA at 781-505-7500 or on the Internet at www.ibasis.com

The New England Technology Fast 50 program is presented by Deloitte & Touche and Hale and Dorr, in association with the sponsor, Mazonson Inc. In addition, Mass High Tech and Trinity Communications are associated with the program.

Assured Quality Routing, ConnectPoint, and iBasis are registered marks, Pingo, DirectVoIP, The iBasis Network, Internet Central Office, Internet Branch Office, and IP CallCard are trademarks of iBasis, Inc. Cisco and Cisco Powered are registered trademarks of Cisco Systems, Inc. All other trademarks are the property of their respective owners.

   
 
 
     

 

 
 

1 Telegeography 2003 data compared with iBasis annualized Q1 2004 traffic volume.

2 ATLANTIC-ACM International Wholesale Carrier Report Card—2002, 2003, & 2004.

Assured Quality Routing and iBasis are registered marks, DirectVoIP and The iBasis Network are trademarks of iBasis, Inc. Cisco and Cisco Powered Network are registered trademarks of Cisco Systems, Inc. All other trademarks are the property of their respective owners.

Except for historical information, all of the expectations, projections and assumptions contained in the foregoing press release, including those relating to the company's current expectations regarding revenue growth, sources of revenue, margin improvement, profitability, future capital expenditures, and cash flows constitute forward-looking statements under the Private Securities Litigation Reform Act of 1995 and involve risks and uncertainties. Important factors that could cause actual results to differ materially from such forward-looking statements include, but are not limited to, (i) the extent of adoption of the company's services and the timing and amount of revenue and margin generated by these services; (ii) fluctuations in the market for and pricing of these services; and (iii) the other considerations described as "Risk Factors" in the Company's most recent Forms 10-K and 10-Q, and the company's other SEC filings. We have no current intention to update any forward-looking statements.

Use of Non-GAAP Financial Data
The Company provides certain financial data in addition to providing financial results in accordance with GAAP. This data is not in accordance with, or an alternative to GAAP, and may be different from Non-GAAP financial data used by other companies. This Non-GAAP financial data includes average revenue per minute, which the Company believes provides useful information, to both its management and investors about the Company's current performance.