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IDT Corporation

IDT Corporation. December 2003 Confidential. Howard Jonas, Chairman Jim Courter, Chief Executive Officer Ira Greenstein, President Steve Brown, Chief Financial Officer Marcelo Fischer, Chief Accounting Officer. IDT Corporation. Summary Market Information. Market Cap: $1.6 Billion

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IDT Corporation

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  1. IDT Corporation December 2003 Confidential Howard Jonas, ChairmanJim Courter, Chief Executive OfficerIra Greenstein, PresidentSteve Brown, Chief Financial OfficerMarcelo Fischer, Chief Accounting Officer

  2. IDT Corporation Summary Market Information Market Cap: $1.6 Billion Fiscal 2003 Revenues: $1.8 Billion Cash Balance: $1 Billion Exchange: NYSE Headquarters: Newark, NJ Employees: 3,800 Offices: 17 Countries On 5 Continents State Of Incorporation: Delaware Equity Research: Wm Smith Securities, Janco Partners Attorneys: McDermott Will & Emery Auditors: Ernst & Young Board Representation: 8 Outside Directors, 6 Inside Directors Tickers: IDT IDT.C Class A Price As Of 12/12/03:$20.00 $19.25 Not Traded 52 Week High: $20.50 $19.50 52 Week Low: $13.75 $13.70 Shares Outstanding: 51.2 Mil. 22.1 Mil. 9.8 Mil. 83.1 Mil Total As Of 10/20/03

  3. IDT Corporation Solutions (100% owned) $85 million Media (94% owned) $23 million IDT Revenue Run Rate Q4 2003 IDT Corporation Revenue $2.1 billion Telecom (95% owned) $1.8 billion Entertainment (94% owned) $48 million Net2Phone (controlled, 22% owned) $76 million Liberty Broadcasting Digital Production Solutions (90% owned) Net2Phone Global Services Retail $1.3 billion Wholesale $502 million WMET Net2Phone Cable Telephony Calling Cards $1.17 billion Film Roman (82% owned) Domestic $955 million CTM Brochure Display Vanguard Anim. (12.5% owned) International $165 million OTV MainFrameEntertainment (62% owned) Consumer Phone Services $149 million Anchor BayEnt. (100% ownedupon closing) Callback $0.5million

  4. IDT Corporation Ownership & Control Of IDT Corporation Economic Interest: Voting Interest: Institutional Holders 43.9% Howard Jonas 56.3% Howard Jonas 21.4% Institutional Holders 33.0% Retail Holders 20.6% Retail Holders 8.6% Liberty Media 12.3% Liberty Media 1.8% AT&T 1.6% AT&T 0.2% Class B 51.2 Million Shares NYSE: IDT 1/10 Vote/Share Common 22.1 Million Shares NYSE: IDT.C 1 Vote/Share Class A 9.8 Million Shares 3 Votes/Share Class A Convert To Common Upon Sale

  5. IDT Corporation IDT History December 2001 Acquire Winstar Assets October 2001 Reacquire NTOP Control February 2001 List on NYSE Acquire PT1 August 2000 Sell NTOP Shares To AT&T July 1999 Net2Phone IPO July 1997 Begin Marketing Prepaid Cards July 1996 Launch Net2Phone March 1996 IPO April 1995 Introduce Carrier Service

  6. IDT Telecom

  7. IDT Telecom Overview Telecom Fast Facts • Provides retail and wholesale telecommunications services worldwide • Telecom minutes-of-use run-rate in excess of 1.5 billion minutes per month, 19 billion annually • Fiscal 2003 revenue of $1.6 billion Revenue ($ millions) Operating Income ($ millions) Telecom Minutes Of Use (millions)

  8. IDT Telecom Telecom Major Services • Calling cards • Monthly sales exceed 18 million cards • Over 350,000 global points of distribution • Access to 230 countries • Private label - high margin business • Walgreens – Largest major retail private label customer • Also sell corporate cards and promotional cards • Consumer phone services • Five cents-a-minute plan has over 525,000 customers • America Unlimited Flat Rate Service roll out began in August 2003 • America Unlimited customer count 70,000 and growing about 8,000 per week • Currently offered in NY, NJ, PA, MD, DE, WV, MA and NH • Wholesale carriers

  9. IDT Telecom Wholesale Carrier Our customers include most of the largest, most important Telecom companies in the world.

  10. IDT Telecom Contribution Of Telecom Services Revenue Growth Fiscal 2003 Revenue Gross Profits Q1 2004 Revenue Gross Profits $ Millions Calling Cards $1,080.0 $240.0 292.0 66.2 7.9% Wholesale Carrier 405.5 45.6 125.6 13.8 50.5% Consumer Phone Services 152.0 85.8 37.2 19.4 4.4% Callback 1.3 0.7 0.1 – – Total $1,638.7 $372.2 455.0 99.6 16.6% 22.2% 11.2% 56.5% 59.3% 22.7% 22.7% 11.0% 52.2% 57.4% 21.9%

  11. IDT Telecom U.S. Calling Card Operations Dark blue shaded areas represent states where significant numbers of IDT calling cards are distributed.

  12. IDT Solutions Services provided by Winstar Communications L.L.C., an IDT Company

  13. IDT Solutions The Winstar Network • Hybrid fixed-wireless and fiber infrastructure • “Last Mile” wireless connectivity to customer using licensed commercial spectrum • Spectrum holdings cover 100% of U.S. • Rights to 1,200 intra-city fiber miles and 250 interstate fiber miles • Access to nationwide fiber network • Customer building to hub to switch • 4800 Buildings with access rights • 2300 Provisioned (wired) buildings • 154 Hubs • 5 Data POPs • 21 Voice switches • 54 Data switches • Two network operating centers • Herndon, VA • Seattle, WA

  14. IDT Solutions Service Offerings • IDT Solutions provides a full range of broadband and telephony services to commercial and governmental customers. • Voice services • Local • Long distance (dedicated & switched) • International • Internet & data services • High Speed Internet • Dedicated internet • Private lines • WAN • Other services • Conferencing • Web hosting • Calling cards Winstar Central Office Customer Location

  15. IDT Solutions IDT Solutions Unique Value Proposition • One of few carriers that can deliver a bundled suite of local, long distance and data services • Provide true network diversity and redundancy to fiber-based networks • Competitive pricing • Service reliability, performance and security – multi-layered fault tolerant architecture

  16. IDT Solutions IDT Solutions Acquisition December 19, 2001, – April 17, 2002 Cash $ 30.0 million IDT Class B Shares 25.8 million Purchase $ 55.8 million Working Capital* 150.0 million Total $205.8 million *Amount funded as of July 2003

  17. IDT Solutions 22 Cities Of IDT Solutions Atlanta Baltimore Boston Chicago* Cincinnati Dallas/Ft. Worth* Denver Detroit Houston Los Angeles* Miami Minneapolis/St Paul New York City* Newark (NJ) Orange County (CA) Philadelphia Phoenix San Francisco Seattle Stamford (CT) Tampa Washington DC* 17 Offices 12,500 Customer accounts *Top 5 cities (account for 45% of on-net revenue)

  18. IDT Solutions IDT Solutions Burn Reduction Plan Interim Goal – $2.5 Million Maximum Monthly Cash Burn • Reduce excess capacity on network • Terminate leases on buildings with limited revenue potential • Measure and enforce productivity targets for sales • Eliminate underused hubs, thereby further reducing real estate and capacity costs without sacrificing current or future revenue • Reduce headcount Burn Reduction Plan • Preserves current revenue • Does not prevent future growth • Does not destroy asset value

  19. IDT Entertainment Leadership In … High Quality 3D Computer Animation And 2D Cel Animation Developing/Acquiring Libraries Of Animated Intellectual Properties Distribution Of Owned And Licensed Intellectual Properties To Retail

  20. IDT Entertainment Global Animation Studios • 4 production hubs in Newark, LA, Toronto, Israel linking 2500 global animators • Highest quality animation at low costs, high speed and improved management control • Recent productions: Monster Monster Trucks, Cabbage Patch Kids – JUMP!, Hip Hop & Hamilton • Currently in development: Starpoint Academy, Happily N’ever After, one other film • Requires credibility and recognition to gain access to better project flow Film Roman, Inc. • Controlling interest acquired May 2003 • Leading 2-D animation producer of primetime series (Simpsons™, King of the Hill™) • Creative strength and credibility in the television industry

  21. IDT Entertainment Vanguard Films, Inc. • Minority stake purchased in July 2003 • Feature film industry powerhouse known for creativity, discipline, efficiency • Relationships with Disney, Dreamworks, Warner Brothers, Sony, Nickelodeon Mainframe Entertainment Inc. • Controlling interest acquired September 2003 • Leading 3-D animation producer for TV and direct-to-video products • Canadian animation hub • Relationships with Hasbro, Mattel, Sony Anchor Bay Entertainment Group • A leading independent video distributor of licensed intellectual properties to retailers such as Wal-Mart, K-Mart and Target • Specializes in horror and children genres; #1 distributor of fitness home-video titles • Relationships with proven Hollywood directors including Sam Raimi, Werner Herzog and George Romero • Distributes titles such as Thomas the Tank Engine and Crunch fitness videos

  22. IDT Entertainment DPS (90% owned) Film Roman (82% owned) MainFrame (62% owned) Vanguard (12.5% owned) Anchor Bay (100% owned) Film Roman (85% owned) Thomas The Tank Engine Starpoint Academy Valiant Thomas The TankEngine The Simpsons Barbie Monster Monster Trucks Crunch King Of The Hill Spider-Man Halloween Happily N’Ever After X-Men: Evolutions Alien Legion Hip Hop & Hamilton Evil Dead Tony Hawks SHADE Tripping The Rift IDT Entertainment

  23. IDT Entertainment IDT Entertainment Acquisitions

  24. IDT Entertainment Executive Bios • John Hyde, President and CEO, Film Roman – extensive experience in entertainment production and distribution, as well as management consulting and restructuring of entertainment companies. CEO of Crossroads V Communications and Starbound Records, Chairman and CEO of MCEG Sterling. • John Williams, CEO, Vanguard Animation – originating producer of Shrek, other credits include “The Tuxedo” and “Seven Years in Tibet.” • Neil Braun, President, Vanguard Animation - President of the NBC Television Network, Chairman and CEO of Viacom Entertainment, President of Imagine Entertainment, and Senior Vice President of HBO • Rick Mischel, CEO, Mainframe Entertainment - President and Chief Operating Officer at The Harvey Entertainment Company, Senior Vice President of Live Entertainment.

  25. IDT Media Innovative, Technologically Advanced Communications Platforms

  26. IDT Media Liberty Broadcasting Systems • Barter syndication networks • 5 Million+ listeners • Long Form programs + features • CY 2003 Revenue exceeds CY2002 by about 50% • Intelligent product includes current hosts William Kristol and Linda Chavez; Charles Krauthammer to begin in March WMET • Building out station to 50K watts daytime • DC will serve as a distribution point for the new “Intelligent Talk” format Liberty Broadcasting System)

  27. IDT Media Delivering Video To The Office Desktop • Broadcast quality 24/7 news delivered to the office desktop via high speed IP • Research indicates demand for news product at significant markup exists • Content agreements reached • Ops tests completed / Microsoft endorsed • Patent pending “plug-ins” in development • Subscription / advertising financial model • 1MM desktops = $90MM in annual revenue • Will be marketed via IDT Solutions, private internet and direct to fortune 1000 companies

  28. IDT Media CTM Achieves Record Sales / EBITDA • Primarily distributes brochures to hotels, travel hubs and corporations • 10,000+ racks, estimated 70% market share east of the Mississippi in the U.S. and Canada • Recently entered Puerto Rico market • FY 2003 revenue exceeds $15MM • EBITDA approaches 25% • Growth will come from expansion of delivery areas, printing and diversification into collateral distribution

  29. Net2Phone Communication Without Borders

  30. Net2Phone Net2Phone Key Points • Interim goal – $2.5 million maximum monthly cash burn • Cable telephony subscribers expected to grow almost 30% annually through 2006, exceeding 22MM subscribers • Telecom providers in the U.S. projected to lose over $10bn in revenues to cable VoIP by 2012 • Net2phone the only fully outsourced, proven “PSTN” quality cable telephony solution for MSOS • Proven ability to develop and deploy VoIP services • Profitable core business, which earned $1.8 million in FY 2003 on revenues of $91 million • Conservative capital structure and strong liquidity. Recent secondary offering netted $63 million, raising liquid assets to $157 million

  31. Net2Phone Net2Phone Voice Over IP Offerings • International Communication Services (ICS) – 55% of NGS revenue • Channel sales • Integrated sale of VoIP hardware and minutes through distribution channels worldwide • Emerging markets are a significant growth opportunity • PC-to-phone service • Wholesale Services to Carriers using VoIP technology • Big market opportunities on the horizon as telecommunication markets deregulate, including Latin America and the Middle East • Calling card services – 45% of NGS revenue • Disposable • Rechargeable • Net2Phone cable telephony targeting a sizeable, immediate market • Complete suite of NCT services allow cable companies to deliver residential phone service • Only fully outsourced, proven “PSTN” telecom solution for cable operators • Leverage existing technology • Tailored to meet MSO’s strategic and financial needs • Conforms to CableLabs’ PacketCable standards • Initial contract signed in October

  32. Net2Phone Cable Market Opportunity • Cable telephony a likely replacement for traditional phone • Users spend just as much on cable telephony as they do on regular telephony ($53/month) (FCC and ATT Broadband) • When a cable provider adds telephony services to their suite, penetration rates increase 25-30% (DB Alex. Brown) • Cox reports cable telephony bundle has 30% penetration of homes passed in mature markets • AT&T Broadband reports a 40-50% churn reduction by offering triple play; Cox reports 53% churn reduction among triple play subs, vs. 25% among video and data only subs • By outsourcing IP telephony, cable operators can reduce their incremental deployment costs for telephony by 90% • Primary line cable telephony revenue to hit $4.4 billion by 2006 (JP Morgan) • Net2Phone’s opportunity: Second tier cable • Internal estimate of Net2Phone’s cable market opportunity is 82 million homes • Competitive edge by offering “triple play” • Second tier companies need incremental revenue • 20% of MSO’s revenue will come from telephony services by 2007 (Goldman Sachs) • Can’t spend the Cap Ex • Have regulatory commitments to deliver telephony • Cable companies do not have telecom expertise • Net2Phone cable business model • Licensing fees • Per minute recurring revenue • Annual maintenance and support fees

  33. Net2Phone Net2Phone Investment Breakout Economic Interest: Voting Interest: NTOP Holdings, LLC 38.8% NTOP Holdings, LLC 55.9% Other 61.2% Other 44.1% Additionally,Net2Phone is obliged to issue 6.9 million shares of restricted Class A Common Stock to IDT upon signing a telecom services agreement which has been negotiated.There are a total of 74.4 million NTOP shares outstanding. As of 11/25/2003 NTOP Holdings, LLC is a group consisting of IDT Corp. and Liberty Media. IDT controls the right to vote for the LLC in most matters, and is the managing member of the LLC. IDT and Liberty Media each also hold 1,250,000 shares of Net2Phone outside the LLC.

  34. Financial Information Services provided by Winstar Communications L.L.C., an IDT Company

  35. Financial Information Consolidated Balance Sheet

  36. Financial Information Consolidated Income Statement

  37. Financial Information Consolidated Quarterly Income Statement

  38. Financial Information Telecom Quarterly Operating Statement

  39. Financial Information IDT Solutions Quarterly Operating Statement

  40. Financial Information Media Quarterly Operating Statement

  41. Financial Information Entertainment Operating Statement

  42. Financial Information Corporate Quarterly Operating Statement

  43. Financial Information Net2Phone Quarterly Operating Statement

  44. Financial Information Corporate Governance Independent Directors IDT Corporation J. Warren Blaker Senator Rudy Boschwitz Saul K. Fenster Governor James S. Gilmore The Honorable Jack Kemp Michael J. Levitt Admiral William Owens Governor William Weld Solutions Claire Calandra Director Jacob Lew George Rupp Howard Safir Herbert H. Tate Telecom Secretary William Cohen Muni Figueres Vito Spitaleri Media & Entertainment Merv Adelson Rev. Eric Cosentino Rabbi Irwin Katsof Roberto Muller Harvey Schiller Governor Pete Wilson Net2Phone Stephen Goldsmith Jesse King Harry McPherson James R. Mellor Marc J. Openheimer Dan Schulman Dr. Michael Weiss Tony Werner

  45. Financial Information Corporate Governance IDT Corp. Independent Directors Professor, Fairleigh Dickinson University Former CEO of University Optical Products, Inc. Chairman of the Advisory Committee of the Center for Global Food Issues Former U.S. Senator President of NJ Institute of Technology Partner at Kelley Drye and Warren LLP, practicing homeland security, corporate and technology law Sixty-eighth Governor of the Commonwealth of Virginia Former 9-term U.S. Congressman and former Secretary of Housing & Urban Development Chairman of Ilios Capital LLC Former partner, Hicks,Muse, Tate & Furst, Inc. Former Deputy Head of Investment Banking, Smith Barney Vice Chairman and Co-Chief Executive Officer of Teledisic LLC Former Vice Chairman of the Joint Chiefs of Staff Principal, Leeds Weld & Co. Former Governor of Massachusetts J. Warren Blaker Senator Rudy Boschwitz Saul K. Fenster Governor James S. Gilmore The Honorable Jack Kemp Michael J. Levitt Admiral William Owens Governor William Weld

  46. Financial Information Corporate Governance IDT Telecom Independent Directors Secretary William Cohen Muni Figueres Vito Spitaleri Chairman and CEO of The Cohen Group Former Secretary of Defense and former 3-term U.S. Senator Writer on Economics and Politics Former External Relations Advisor of the Inter-American Development Bank Former Costa Rican Minster of Foreign Trade Financial Advisor Former Vice President and Treasurer of Mars, Inc.

  47. Financial Information Corporate Governance IDT Solutions Division Independent Directors President of the CLC Group Former executive with TyCom Ltd and AT&T Executive Vice President and Professor of Public Administration at New York University Former Director of the U.S. Office of Management and Budget, and also a former member of the National Security Council President of the International Rescue Committee Prior President of Columbia and RiceUniversities Chairman and CEO of SafirRosetti Former New York City Police Commissioner Professor, N.J. Institute of Technology Former President of the N.J. Board of Public Utilities Claire Calandra Director Jacob Lew George Rupp Howard Safir Herbert H. Tate

  48. Financial Information Corporate Governance Media & Entertainment Independent Directors Merv Adelson Rev. Eric Cosentino Rabbi Irwin Katsof Roberto Muller Harvey Schiller Governor Pete Wilson Co-founder of Lorimar Telepictures, where he served as Chairman and CEO Rector of the Episcopal Church of the Divine Love in Montrose, New York Executive Director of the Jerusalem Fund of Aish HaTorah Co-author with Larry King of Powerful Prayers and How to Get Your Prayers Answered President and CEO of The Muller Sports Group Former president of International Founder of PONY Sports and Leisure Chairman and CEO of YankeeNets Former Governor of the State of California Former U.S. Senator Former Mayor of San Diego

  49. Financial Information Corporate Governance Net2Phone Independent Directors Special Advisor to President Bush. Also Sr. VP for e-Government and Strategic Initiatives with Affiliated Computer Services, Faculty Director for innovations in American Government at Harvard's Kennedy School of Government, and Chairman the Corporation for National and Community Service. COO, Daniels Fund. Former Operations Manager for Rockefeller Foundation's Next Generation Leadership Program and The Philanthropy Workshop. Chairman, Verner, Liipfert, Bernhard, McPherson and Hand. Former Chairman of the U.S. International Cultural and Trade Center Commission. Chairman, USEC, Inc. Former Chairman and CEO of General Dynamics. President and CEO of Crystallex International Corporation. Former Director of Trade and Merchant Banking with Midlantic National Bank. CEO, Virgin Mobile USA, LLC. Former President and COO of priceline.com. Former President of the AT&T Consumer Markets Division and of AT&T WorldNet Service. Associate Clinical Professor of Ophthalmology at Columbia College of Physicians and Surgeons and Director of Uveitis Service at the Edward S. Harkness Eye Institute. Chief Technology Officer, Liberty Media. Former CEO of Aurora Networks & CTO for AT&T broadband. Stephen Goldsmith Jesse King Harry McPherson James R. Mellor Marc J. Oppenheimer Dan Schulman Dr. Michael Weiss Tony Werner

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