Deal Bolster's IDT's Strategic Position in Billion Dollar Market

HACKENSACK, NJ -- October 30, 1997 -- IDT Corporation (NASDAQ: IDTC) today announced that it has negotiated an agreement to receive income derived from a master patent covering pre-paid calling cards throughout Europe. Under the agreement, the Company is entitled to receive royalties from all companies selling pre-paid calling cards in Europe who take a license under the patent or against which the patent is successfully enforced. Phone companies using or intending to use the patented process can negotiate to receive credit towards their royalty obligations by purchasing telecommunications services from IDT. This is anticipated to be attractive to European carriers in that it will enable them to fulfill demand for their services without raising total costs, and in most cases, will actually cut them. It is expected this will greatly accelerate the growth of IDTís carrier business from Europe.

"IDT has already established itself as a leader in pre-paid calling cards in the U.S., and we look forward to emerging as a dominant player in the European market," said IDTís CEO Howard Jonas. "Not only does our carrier network give us the best available international rates, but now it looks like all our competitors will have to sit up and take notice. This is a real home run ñ a bit like winning the Grand National."

Under the patent agreement, IDT is entitled to grant sub-licenses with respect to applicable pre-paid calling cards in Europe. Consequently, current pre-paid calling card companies and prospective pre-paid calling card vendors who are using or intend to use the patented process can apply for a sub-license from IDT. IDT is able to bring the pre-paid calling card technology to Europe due to its extensive telecommunications infrastructure as well as its own facilities-based switch in London with C7 signaling.

"This is an innovative step by IDT to establish itself in the European marketplace," said Christopher Hoyle of Rakisons, a well-established international practice specializing in gaining licenses for new telecommunications operators. "Technological change is leading to ever more inventive ways to provide telecom services. IDT is to be congratulated for seeking to highlight that protection of intellectual property rights is crucial to ensuring the benefit of these enhancements flows to consumers in the form of better services and cheaper phone bills."

The Company will also be selling its own discounted pre-paid calling card throughout Europe. IDT Global Limited Calling Cards will be available for purchase throughout Europe at newsstands and kiosks.

IDT Corporation is a diversified telecommunications company with seven years of innovation within the international telecommunications arena. The Company provides international long distance services to individuals and businesses in over 225 countries and directly to telecommunications carriers in the US and overseas. The Company currently has over 400,000 retail customers using an array of services including international long distance and Internet services, and prepaid calling cards. The Company is also a leader in Internet Telephony, with its Net2Phone product - the first commercial telephone service to bridge live calls between the Internet and telephones.

Except for historical information, all of the expectations and assumptions contained in the foregoing are forward-looking statements involving risks and uncertainties. Important factors that could cause actual results to differ materially from such forward-looking statements, include, but are not limited to, the competitive environment for Internet telephony, changes of rates of all related telco rates and services, legislation that may affect the Internet Telephony industry, IDT's ability to operate the services described on a large scale commercial level. For additional information regarding these and other risks associated with the Company's business refer to the Company's reports filed with the SEC.