Subsid's Joint Venture

Telefonica SA
20 June 2000

Terra Networks S.A., a Telefonica subsidiary, in accordance with that stated in
article 82 of the Spanish Stock Market Law and that set forth in the Circular
Letter 14/1998 of the Spanish Securities Commission of December 28th, 1998,
hereby announces the following:-

On June 15th 2000, Telepizza and Terra Networks S.A., signed a Joint Venture
contract ('the Contract') the execution of which was agreed in the Memorandum
of Understanding signed by the two parties on April 26th, 2000 and announced as
a Significant Event to the Spanish Securities Commission on that same date.

The Contract controls the relations between Tele Pizza and Terra Networks S.A.,
regarding the shareholders of the Spanish joint venture to be incorporated by
the two parties, each holding a 50% stake.  This new venture will be responsible
for the storing, marketing, purchase, leasing and distribution of
products, directly or through third parties, through telematic communications
networks or channels, to be delivered to the end-user within a period of between
one or twenty-four hours.  The share capital for this joint venture will amount
to Euros 2,600,000 and it will have an initial equity of 
Euros 5,600,000.

Tele Pizza, S.A., and Terra Networks S.A., will provide the services
corresponding to their respective areas of activity, in accordance with the
needs requested, as well as financial support to enhance the development of
this venture.

Jose Maria Mas Millet
Director and Secretary of the Board
Terra Networks S.A.