Re Agreement

Telefonica SA
18 July 2001


 
           GROUP 3G, TELEFONICA MOVILES GERMAN AFFILIATE, 
       REACHES UMTS INTERCONECTION AGREEMENT WITH DEUTSCHE TELEKOM AG

   The accord will permit Group 3G to offer its future clients the possibility  
   of making and receiving all types of calls, once the company begins to       
   offer voice and data products and services via GSM and GPRS.


Munich, 17 July 2001 - Group 3G, the German mobile phone operator of the
Telefonica Moviles Group, has reached an agreement for interconnection on UMTS
networks with the German operator Deutsche Telekom AG.

This accord, the first of its kind reached in Germany, will allow Group 3G to
offer its future clients the possibility of making and receiving calls to and
from all types of telephones (fixed or cellular), German or international, once
Group 3G begins to offer voice and data products and services via GSM and GPRS.

Lar April, Group 3G signed a roaming agreement with the German mobile operator
E-Plus, which will allow it to offer products and services to German clients
over GSM/GPRS networks in the coming months, much earlier than was foreseen in
the operator's original plans.

Group 3G is owned 57.2% by Telefonica Moviles and 42.8% by the Finnish operator
Sonera. In August 2000, it obtained one of six licenses for third-generation
mobile telephony which were awarded at auction in Germany.