XFONE 018 Continues to Increase Its Share of Israel's International Long Distance Calling Market May 2005 Results Reflect 20% Increase in Customers and 13% Increase in Monthly Call Minutes LONDON and TEL AVIV, Israel, June 2 /PRNewswire-FirstCall/ -- XFONE 018 Ltd. (until March 2005 previously named XFONE Communication Ltd.), the majority owned Israel-based subsidiary of XFONE, Inc. (OTC:XFNE) (BULLETIN BOARD: XFNE) , today reported that its "018" international long distance carrier operations in Israel have continued to grow above original expectations. As of May 31, 2005, XFONE 018 had logged approximately 90,000 registered and unregistered customers since first launching operations in mid- December 2004, which reflects a 20% increase in the number of new customers from April 2005 to May 2005. In addition, from April 2005 to May 2005, call minutes increased by 13%. The Company also announced that XFONE 018's international long distance calling services have been formally endorsed by both the Committee of Rabbis for Communication Issues and the Committee of Rabbis for the Sake of the Sabbath. Both Committees have given XFONE 018 their respective Seals of Approval, thereby giving comfort to the Ultra-Orthodox Jewish community that the Company conducts its business in accordance with religious and ethical covenants of Ultra-Orthodox Jewish beliefs and practices. Currently, it is estimated that approximately 10% of the population in the State of Israel observes the Ultra-Orthodox Jewish faith. "We are very honored to have been singled out by religious leaders of the Ultra-Orthodox community as the preferenced service provider of international long distance calling services," stated Rafi Dick, Managing Director of XFONE 018 Ltd. "Our policy to permit our employees to observe the Sabbath, in addition to our prohibition of 1919 calls (similar to the U.S.' tolled 900 adult entertainment calls) on our system, have served to win XFONE 018 these notable endorsements from Israel's spiritual community." 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 018'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 018 also permits users to predetermine the cost per minute by dialing "01800." Moreover, XFONE 018 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. XFONE 018 is one of only six companies that have been granted international long distance carrier licenses in the state of Israel. About XFONE, Inc. A U.S.-domiciled corporation, XFONE, Inc. is an international voice and data communications services provider with operations in the United Kingdom, the United States and Israel that 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. This press release contains forward-looking statements. The words or phrases "should," "would be," "will allow," "intends to," "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "project," or similar expressions are intended to identify "forward-looking statements." The Company's financial results reflected above should not be construed by any means as representative of the current or future value of its common stock. All information set forth in this press 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 rapidly changing technology and evolving standards in the industries in which the Company and its subsidiaries operate; the ability to obtain sufficient funding to continue operations, maintain adequate cash flow, profitably exploit new business, and license and sign new agreements; 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. 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.018.co.il/ http://www.xfone.com/

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