IPSE 2000 Consortium

Telefonica SA
23 August 2000


TELEFONICA MOVILES FORMALIZES IPSE 2000 CONSORTIUM FOR UMTS LICENSE IN ITALY

Madrid, 23 August, 2000 - The IPSE 2000 consortium, which tomorrow will express
its intention of interest to take part in the UMTS License licitation process in
Italy, has been formally constituted by partners Telefonica Moviles, Sonera
Atlanet, Banca di Roma, Goldenegg, Xera and e.Planet.

The equity structure of the consortium will initially be as follows:

          Telefonica Moviles      30,0%
          Sonera                  19,0%
          Atlanet                 19,0%
          Banca di Roma           19,0%
          Goldenegg                7,0%
          Xera                     5,5%
          e.Planet                 0,5%

The final ownership structure of the consortium will be settled by September 11,
the pre-qualification deadline in the application process. The consortium is
negotiating with other important potential partners that could be joining in the
days to come.

The licitation process for five UMTS licences will begin in October. Each of the
licenses gives the winner the right to 2x10 MHz of paired spectrum and 5 MHz of
unpaired spectrum. The initial bidding price for each license is 2.067 billion
euros.

Partners in IPSE 2000

The IPSE 2000 consortium is led by Telefonica Moviles, one the six largest
mobile phone operators in the world, with more than 25 million clients, half of
them in Spain and half in Latin America. Sonera is the major telecommunications
operator in Finland, providing fixed and mobile telecommunication services
including internet access. Atlanet, a joint venture between ACEA SpA.,
Telefonica Data and FIAT/Ifil, recently launched telecommunications services in
Italy. Banca di Roma, one of Italy's major banking institutions, is also the
holding company of 'Banca di Roma Group' with operations in Italy and abroad.

Goldenegg, a financial company of the Moratti Group, has strategic investments
in the telecommunication field.  Xera, the company responsible for mobile
communication within the Sequenza group, is active in many fields of the new
technologies, with a focus on the telecommunications, internet applications and
information technology sectors. E.Planet is a telecommunications operator that
offers multimedia services and high value-added services and applications over
broadband local access.

Telefonica Moviles

Telefonica Moviles, a 100%-owned subsidiary of Telefonica S.A. has been already
awarded two UMTS licenses in Europe, the first in Spain and the second in
Germany through the 3G Consortium, held 57% by its subsidiary Telefonica
Intercontinental and 43% by Sonera of Finland. In this way, Telefonica Moviles
positions itself as one of the leading companies in the mobile communications
sector in Europe.

The awarding of the UMTS licence in Italy has a great value in the   
international development strategies of Telefonica, as it would allow the
Group to strengthen its presence in the Italian market. Telefonica already
provides fixed line, internet and data transmission services through Atlanet, a
partnership with ACEA and FIAT/Ifil which launched operations in late spring
2000. The Telefonica Group has also a significant presence in Italy through
Terra-Lycos, which is among the most visited portals in Italy.

Telefonica Moviles, through Telefonica InterContinental is currently taking part
in the process for the UMTS licenses in France, in partnership with Suez
Lyonnaise des Eaux, and is also involved in similar processes in Central Europe
and Scandinavian countries, together with Sonera and other relevant partners.


For further information

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