Telekom Malaysia Connects to iBasis for International VoIP Service.

Business Editors/High-Tech Writers

BURLINGTON, Mass.--(BUSINESS WIRE)--May 26, 2004

DirectVoIP(TM) Interconnection with Premier Malaysian Carrier

Provides iBasis Access to Rapidly Growing

Traffic -- Inbound and Outbound

iBasis, Inc. (OTCBB: IBAS), the leader in Internet-based voice communications, today announced that Telekom Malaysia, the national carrier of Malaysia, has established a direct VoIP interconnection with The iBasis Network(TM) for exchanging inbound and outbound international voice traffic.

Telekom Malaysia has taken advantage of the iBasis DirectVoIP service to implement a direct IP connection between its multi-vendor VoIP infrastructure and the iBasis Cisco Powered Network(R). As a result, Telekom Malaysia is able to realize the cost-efficiencies of international VoIP for both inbound and outbound internationals calls. It provides iBasis with greater opportunity to capture a significant share of the more than two billion minutes of annual international traffic that either originates or terminates in Malaysia.

Telekom Malaysia joins the more than 230 carriers worldwide who have formed relationships with iBasis to send and receive international long distance calls over the company's Cisco Powered Network, which has carried more than nine billion minutes of international calls. By providing Tier One quality international service to these carriers, iBasis has become one of the world's 10 largest carriers of international traffic(1) and was recently ranked by global service providers for the third consecutive year as the world's best international wholesale carrier(2).

"Large national carriers like Telekom Malaysia are recognizing the value of establishing direct VoIP interconnections for their international service," said Ofer Gneezy, president and CEO of iBasis. "Telekom Malaysia has a strong record of providing innovative services to business and residential customers. By taking advantage of our high quality VoIP service and our many international agreements, Telekom Malaysia can continue to fulfill its mission of being the leading provider of communications services throughout Malaysia."

"We wanted to work with a global provider that would support our high quality of service for our customers while expanding our global communications footprint cost effectively through VoIP," said Siew Yoong Hing, General Manager of Telekom Malaysia (Hong Kong). "iBasis is a very strategic provider for us, getting our VoIP services to market quickly and efficiently."

About DirectVoIP

The iBasis DirectVoIP service enables carriers to quickly establish direct VoIP interconnections with the iBasis global network for the exchange of international phone calls using VoIP infrastructure equipment from a large selection of vendors. Gateways, gatekeepers, softswitches, and session border controllers from nine vendors have been DirectVoIP Certified(TM) following extensive interoperability testing in iBasis' interoperability labs and are being used in international traffic exchange today.

iBasis in Asia

iBasis has significant market presence throughout Asia - a region that has experienced annual growth in VoIP traffic by 95% in 2002, and continues to account for approximately 30% of international VoIP traffic(3). iBasis has achieved significant market share in Asia voice traffic through its relationships with many of the regions leading carriers and PTTs, including China Unicom, China Mobile, China Netcom, CAT Telecom (Thailand), Data Access (India), Telstra, and others.

About Telekom Malaysia

Telekom Malaysia is the largest telecommunications provider in Malaysia, with a 2002 turnover of US$2,587 million. In addition to local telephony, mobile telephony, and broadband data services in Malaysia, Telekom Malaysia provides international telecommunications in South East Asia, Asia Pacific and other selected markets, including the United States, the United Kingdom, Sri Lanka, Bangladesh, French Guinea, Malawi, and South Africa. More information can be found at www.telekom.com.my.

About iBasis

Founded in 1996, iBasis (OTCBB: IBAS) is a leading carrier of wholesale international telecommunications services and a provider of retail international prepaid calling cards sold through major distributors. iBasis customers include many of the largest carriers in the world, including AT&T, Cable & Wireless, China Mobile, China Unicom, MCI, Sprint, Telefonica, Telenor, and Telstra. iBasis has carried more than nine billion minutes of international voice traffic over its global Cisco Powered Network(TM), and is one of the ten largest carriers of international voice traffic in the world(4). For three consecutive years service providers have named the company as the best international wholesale carrier in ATLANTIC-ACM's annual International Wholesale Carrier Report Card(5). iBasis was ranked the #1 fastest-growing technology company in New England in the 2002 and 2003 Technology Fast 50 programs sponsored by Deloitte & Touche. The company can be reached at its worldwide headquarters in Burlington, Massachusetts, USA at 781-505-7500 or on the Internet at www.ibasis.com.

Assured Quality Routing, ConnectPoint, and iBasis are registered marks, The iBasis Network, Internet Central Office, Internet Branch Office, and IP CallCard are trademarks of iBasis, Inc. Cisco and Cisco Powered Network are registered trademarks of Cisco Systems, Inc. All other trademarks are the property of their respective owners.

Except for historical information, all of the expectations, projections and assumptions contained in the foregoing press release, including those relating to the company's current expectations regarding the proposed debt refinancing, revenue growth, sources of revenue, margin improvement and future capital expenditures constitute forward-looking statements under the Private Securities Litigation Reform Act of 1995 and involve risks and uncertainties. Important factors that could cause actual results to differ materially from such forward-looking statements include, but are not limited to, (i) the actual completion of the proposed debt refinancing, as described in iBasis' recently filed Registration Statement on Form S-4, (ii) the extent of adoption of the company's services and the timing and amount of revenue generated by these services; (iii) fluctuations in the market for and pricing of these services; and (iv) the other considerations described as "Risk Factors" in iBasis' most recent Forms 10-K and 10-Q, and the company's other SEC filings. We have no current intention to update any forward-looking statements.

(1) Estimated rank based on iBasis annualized Q1 2004 traffic compared to international traffic volumes for carriers as published in TeleGeography 2004.

(2) ATLANTIC-ACM International Wholesale Carrier Report Card 2004 - April 2004

(3) Telegeography 2004

(4) Telegeography 2003 data compared with iBasis annualized Q1 2004 traffic volume.

(5) ATLANTIC-ACM International Wholesale Carrier Report Card - 2002, 2003, & 2004