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MADRID Spain and REDWOOD CITY, Calif. July 25, 2000 Terra Mobile, the new company created by Telefónica Móviles and Terra Networks in order to deploy the global Wireless Internet portal of Telefónica, and Phone.com, Inc, (Nasdaq: PHCM) a leading provider of mobile Internet software, applications and services today announced their intention to cooperate in establishing world-class implementations and advanced developments of wireless Internet services.

Through this arrangement, Terra Mobile will develop a portal for mobile phones, created to manage Telefónicas wireless telephone services and activities globally. More specifically, through this cooperation, the companies envisage Terra Mobile deploying Phone.coms portfolio of mobile Internet software applications and services, such as the Phone.comä MyPhoneä mobile portal platform solution. As a part of the cooperation the two companies plan to create working teams in order to combine their wireless Internet expertise and technical resources.

Telefónica already offers WAP services in Spain based on the Phone.com UP.Link Server and the aim of the co-operation is to explore broader application areas and extend the relationship between the two companies. Telefónica Móviles and Terra Networks, owners of Terra Mobile, aim to improve their market position for their global operations through this work.

About Terra Mobile

Terra Mobile is Telefónicas global mobile portal. Telefónica Móviles, the business division of Telefónica managing the wireless telephone services and activities globally, holds 51% and Terra Networks, the Internet branch of Telefónica S.A., holds a 49% stake in Terra Mobile. Terra Mobile aims to become a leading worldwide mobile Internet portal and will focus its operations on content and services such as messaging, information, e-commerce, games and multimedia services, accessible through mobile phones using the WAP, GPRS and UMTS standards and technologies. Data and mobile Internet services represent one of Telefónica Móviles groups key growth drivers for coming years, with enormous potential for value creation.

About Phone.com
Phone.com, Inc. (Nasdaq:PHCM) is a leading provider of software, applications, and services that enable the delivery of Internet-based information and voice services to mass-market wireless telephones. Using its software, wireless subscribers have access to Internet- and corporate intranet-based services, including email, news, stocks, weather, travel and sports. In addition, subscribers have access via their wireless telephones to network operators intranet-based telephony services, which may include over-the-air activation, call management, billing history information, pricing plan subscription and voice message management. Phone.com is headquartered in Silicon Valley, California and has regional offices in Madrid, Belfast, Copenhagen, Hong Kong, London, Paris, Rome, Seoul and Tokyo. Visit http://www.phone.com for more information.

Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements involving risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. Potential risks and uncertainties include, but are not limited to, Phone.coms limited operating history, potential fluctuations in Phone.coms operating results, uncertainties related to Phone.coms long sales cycle and reliance on a small number of customers, Phone.coms dependence on the acceptance of its products by network operators and wireless subscribers, Phone.coms ability to adequately address the rapidly-evolving market for delivery of Internet-based services through wireless telephones, the need to achieve widespread integration of Phone.coms browser in wireless telephones, competition from companies with substantially greater financial, technical, marketing and distribution resources and the ability of Phone.com to manage a complex set of engineering, marketing and distribution relationships. Further information regarding these and other risks are included in Phone.coms Form 10-Q for quarters ended September 30, 1999, December 31, 1999, and March 31, 2000, and in its prospectus dated November 16, 1999 and in its other filings with the Securities and Exchange Commission.

Phone.com, thePhone.com logo and the family of terms carrying the UP. prefix are trademarks of Phone.com, Inc. All other company, brand and product names may be marks that are the sole property of their respective owners.

For more information please contact:
Phone.com, Inc.Rowan Benecke PR21 +1 (415) 369 8102 [email protected] Phone.com (Europe) LimitedKylie Trevitt Text 100 Ltd. +44 (0) 181 242 [email protected] Phone.com Japan K.K.Masaaki YamamotoPhone.com Japan K.K.+81 3 5325 [email protected]
Terra Mobile Press Office+34 91 584 48 [email protected]