BT Yahoo! Broadband

BT Group PLC
16 June 2003

NEWS RELEASE

                                                                   June 16, 2003

                     BT AND YAHOO! COME TOGETHER TO DELIVER

                          WORLD-CLASS INTERNET SERVICE

BT has joined forces with Yahoo! to launch a completely new internet experience
to beat its rivals and enhance its position as the UK's leading broadband
internet service provider (ISP) in the ADSL sector.

Under the alliance, BT Openworld will undergo a major transformation to enhance
its broadband service which will be re-named BT Yahoo! Broadband.

BT Yahoo! Broadband promises to take rival ISPs, such as AOL and Freeserve head
on by offering customers the best value package for a service of this kind in
the UK.

Designed specifically to enhance the power of ADSL - BT Yahoo! Broadband will
combine the strengths of Yahoo!'s web content and services supported by BT's
internet access, with BT handling delivery, customer service and billing.

BT Yahoo! Broadband will offer a raft of new and exciting applications, not
available elsewhere, in the first truly integrated service of its kind in
Europe.

The alliance is the next step in Broadband Britain, building on the one million
ADSL customer mark and delivering services and content which will appeal to a
mass market.

Both broadband and narrowband customers signing up to the new package will have
the freedom to customise their personal homepage and browser as never before.

Users will benefit from a built in firewall and anti-virus protection to provide
online protection - at no extra cost.

Customers can also enjoy a whole range of applications designed to make the most
of high-speed access, including interactive gaming across the globe, super
webcam and digital photo libraries, the latest videos and music - with access to
the largest library of music videos on the web, as well as one-click access to
Yahoo!'s world-renowned news, sport and entertainment services and the No.1
ranked Yahoo! Finance.

Email with Yahoo!'s advanced SpamGuard filter and Yahoo! Messenger - the fastest
growing instant messaging service on the web - are also integrated into the
service.

BT Yahoo! Broadband will be available to new customers from September, and
existing BT Openworld broadband customers will move to the new service in a
phased programme. Today's announcement follows a limited commercial arrangement
by the companies in February this year, for the co-promotion of BT Broadband and
Yahoo! premium services.

Pierre Danon, CEO of BT Retail, said: "The alliance is the next step to
realising a Broadband Britain, building on the one million ADSL customer mark
and delivering services and content which will appeal to a mass market.

"With such a compelling product I believe this will provide a significant boost
to our broadband sales."For customers to get the most out of the internet,
several factors are crucial. Access must be safe and fast, use must be
personalised and flexible and content must be exciting, engaging and
imaginative. By joining with Yahoo! we can satisfy all of these criteria, as
well as providing customers with support from two world class organisations."

Duncan Ingram, managing director, BT Openworld, added: "I firmly believe BT
Yahoo! Broadband offers a vastly superior customer experience compared to the
likes of AOL and Freeserve and will prove hard to beat for combined service and
value.

"Both BT and Yahoo! share a common aim - to deliver the best possible online
experience. Joining forces will allow us to achieve this, but also makes great
business sense by strengthening both of our market leading positions."

Terry Semel, chairman and CEO, Yahoo! Inc. said: "We believe that the powerful
combination of Yahoo!'s world-renowned brand and BT's leading market position
can help drive increased DSL adoption in the UK.

"Our alliance with SBC in the United States has already proved this to be a
highly successful business model with the largest growth of any US DSL service
in the first financial quarter of this year.

"With this announcement, Yahoo! is the first internet brand to have entered into
this kind of deep access and programming partnership in the three largest
broadband regions, Europe, Asia and North America.

"Through our global network, Yahoo! serves the largest broadband audience in the
world, and we are committed to providing the best broadband user experience
anywhere."

The alliance will also offer BT Yahoo! Internet Services, a best of breed
narrowband service.



NOTES TO EDITORS

Service elements include:

  • Intelligent portal: learns customers preferences & recommends appropriate
    content
  • Integrated parental controls - allowing full parental control over content
    and sites accessed
  • Built in firewall & anti-virus software - to ensure a safe surfing
    experience
  • Powerful anti-spam - to help shield customers from junk & unwanted email
  • Microsoft Outlook compatibility - allowing customers to use their offline
    email client
  • 100Mb of web space to store emails and photos
  • Photo album software - allowing customers to store, display and manage
    digital photos
  • Web Site Builder - enables quick and easy set up of a web site
  • Pop Up Killer - eliminates unwanted pop up adverts when surfing
  • Super Webcam software
  • BT Openworld will retain customer service and billing for the new service.
    Customer's contracts will remain with BT and their email addresses will not
    change

About BT Openworld

BT Openworld, BT's mass market internet division, is one of the UK's leading
internet service providers. It delivers broadband and narrowband services to
more than 1.7 million business and consumer customers in the UK through
www.btopenworld.com.

The company offers a wide range of internet access packages and payment options.
Broadband packages include: BT Openworld Home 500 Plug & Go and Business 500
Plug & Go - self-install broadband products. Other products cover a choice of
download speeds, from up to 500kbps, to up to 2Mbps, single or multi-user
set-ups for PC or Mac, and static or dynamic IP addresses. BT Openworld also
provides broadband over satellite for business users.

Narrowband products include: BT Openworld Anytime, BT Openworld Surftime, BT
Openworld Connect Anytime - designed specifically for business customers, and
Pay-as-you-go services.

BT Openworld also provides additional value-added services to business users,
such as Wireless LAN, Teleworker and Web Design solutions.

BT Openworld is developing a range of applications and services available to its
own customers and those of other ISPs.

Last year BT Openworld launched various sites aimed at computer gamers, music
fans, classical music lovers, and sports and betting enthusiasts:
www.gamesdomain.co.uk, www.dotmusic.com, www.btopenworld.com/classical, and
www.btopenworld.com/sport. These provide a mix of free and subscription based
services.



About Yahoo!

Yahoo! Inc. is a leading provider of comprehensive online products and services
to consumers and businesses worldwide. Yahoo! is the No. 1 Internet brand
globally and the most trafficked Internet destination worldwide. Headquartered
in Sunnyvale, Calif., Yahoo!'s global network includes 25 World properties and
is available in 13 languages.

For further information contact:

BT
Tony Henderson, BT Openworld, 020 7469 2363

John Carter, BT Retail, 020 7356 4523

Claire Rowberry, OCTANE, 020 7802 2662 ([e-mail])

Yahoo!

Sue Jackson/Kristin Carlos, Yahoo!, 020 7808 4216

Ginni Arnold, Cohn & Wolfe, 0796 873 0247














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