Re Agreement

Telefonica SA
9 May 2002




                            ANTONIO J. ALONSO UREBA

                               General Secretary

                and Member - Secretary of the Board of Directors

                                TELEFONICA, S.A.








'TELEFONICA, S.A.', in accordance with that stated in article 82 of the
Spanish Stock Market Law hereby informs of the following:





                        SIGNIFICANT EVENT




Sogecable and Telefonica, through its media subsidiary Admira, have reached an
agreement to integrate DTS Distribuidora de Television por Satelite (Via
Digital) and Sogecable.


It is foreseen that the operation will take place by way of an increase in the
share capital of Sogecable, aimed at Via Digital shareholders, who will be able
to subscribe the shares issued, up to a maximum figure of 23% of Sogecable's
share capital, through the contribution of their shares in Via Digital. As a
consequence of this agreement, Telefonica will become the holder of a stake in
the share capital of Sogecable on a par with those already held by Prisa and
Groupe Canal+.


The representation of Telefonica, Groupe Canal+ and Prisa on the Board of
Directors of Sogecable will be in accordance with the participation held.
Telefonica will be responsible for proposing the new Chairman of the Board.
Groupe Canal+ and Prisa will maintain their shareholder pact.


The outcome of this agreement, which also includes Sogecable's acquisition of
the participation currently held by Admira in the share capital of Audiovisual
Sport, is being ratified by the Board of Directors of Sogecable and Admira and
is pending the authorisation of the pertinent authorities.


This agreement is a significant step forward in the development of the Spanish
audiovisual market, and means that this will favour the more prompt installation
of digital systems in homes, which will greatly benefit both the user and the
industry.






                                                           Madrid, May 8th, 2002



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