XFONE'S Israel '018' International Long Distance Calling Service Continues Rapid Growth Trend At End of Company's First Full Month of Operation, Call Minutes Now on Pace to Exceed Two Million Per Month ... and Growing LONDON and TEL AVIV, Israel, Feb. 1 /PRNewswire-FirstCall/ -- XFONE Communication Ltd., the majority owned Israel-based subsidiary of XFONE, Inc. (OTC:XFNE) (BULLETIN BOARD: XFNE) , today reported that following its first full month of international long distance carrier operations (January 2005) in Israel, the Company is on pace to exceed two million call minutes per month, which equates to an annualized run-rate of approximately 8.5 million New Israeli Shekels (approximately U.S. $2 million) in revenue. XFONE further noted that the Company is currently registering approximately 100 new customers each day. There are only six companies who have been granted international long distance carrier licenses in the state of Israel. Commenting on the rapid market acceptance of "018", XFONE, Inc.'s President and CEO Guy Nissenson noted, "The early success we are experiencing in Israel supports our strong belief that XFONE Communication Ltd. will contribute measurably to XFONE, Inc.'s growth in 2005 and beyond. Based on these initial results, it appears that we are well on pace in the direction to our goal of achieving a significant share of the total international long distance market in Israel by the end of 2006. Perhaps most noteworthy, however, is the fact that these results also reflect that XFONE Communication is moving in the direction of its goal of achieving positive cash flow and subsequent profitability ahead of our goal date." With no obligations or upfront fees required, international callers located in Israel need only to dial "018" followed by the destination phone number to enjoy the multiple benefits afforded by XFONE's carrier system. Offered at a price per minute that is sometimes as much as 50% less than the most competitive carrier in Israel, XFONE Communication also permits users to predetermine the cost per minute by dialing "01800". Moreover, XFONE Communication has established a state-of-the-art web site, found at http://www.018.co.il/ , where users may also access "real-time" detailed information relative to pricing, full service offerings, and general information regarding system use. "Considering that XFONE does not require people to formally register to use our '018' international long distance calling services, we are pleased to see such a robust number of users electing to register with us to make XFONE their default carrier," stated Rafi Dick, Managing Director of XFONE Communication Ltd. "It is evident that we are experiencing very positive response to our national sales and marketing initiatives, which have concentrated on reaching five key market segments." About XFONE, Inc. A U.S.-domiciled corporation, XFONE, Inc. is an international voice and data communications services provider with operations in the United States, United Kingdom, and Israel, and offers a wide range of services, which include: local, long-distance and international telephone services, prepaid and postpaid calling cards; cellular services; VoIP services; reselling opportunities; and email and fax broadcasting services. The Company serves customers in 75 countries across Europe, Australia, North America, South America, Asia and Africa. Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: All information set forth in this news release, except historical and factual information, represents forward-looking statements. This includes all statements about the company's plans, beliefs, estimates and expectations. These statements are based on current estimates and projections, which involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. These risks and uncertainties include issues related to the ability to: rapidly changing technology and evolving standards in the industries in which the Company and its subsidiaries operate, obtain sufficient funding to continue operations, maintain adequate cash flow, profitably exploit new business, license and sign new agreements; and the unpredictable nature of consumer preferences; and other factors set forth in the Company's most recently filed annual report and registration statement. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's analysis only as of the date hereof. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof. Readers should carefully review the risks and uncertainties described in other documents that the Company files from time to time with the Securities and Exchange Commission, including the Registration Statement effective on November 12, 2004. For More Information, Please Contact: Elite Financial Communications Group Stephanie Noiseux, 407-585-1080 DATASOURCE: XFONE, Inc. CONTACT: Stephanie Noiseux, Elite Financial Communications Group, +1-407-585-1080, or , for XFONE, Inc. Web site: http://www.xfone.com/ http://www.018.co.il/

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