XFONE, Inc. Appoints Two New Independent Board Members and Establishes an Audit Committee.

LONDON -- Company Strengthens Corporate Governance and Financial Controls While Expanding Skill Sets and Disciplines on the Board of Directors

XFONE, Inc. (OTCBB:XFNE) ("XFONE" or "the Company"), today announced the appointments of Mr. Arye Czertok and Mr. Aviu Ben-Horrin as independent members of the Company's Board of Directors and the establishment of an audit committee. The Board additions are intended to enhance the independence of the Board, expand the skill sets and disciplines on the Board, and reflect the Company's commitment to good corporate governance practices and financial controls.

Mr. Czertok brings to the Company over 40 years of public and private company experience in law, executive management, finance and marketing. Since 1980, Mr. Czertok has managed his own law firm and held various senior management and financial positions, including from 1985 to 1991 he was Chairman and CEO of Safety "L" Ltd., an Israel-based company in the field of computerized simulations systems. Mr. Czertok has represented many Israeli publicly traded companies such as Bezek, Electostar, Koor and others. Mr. Czertok led Eshed Robotec Ltd. to a successful IPO and was responsible for all matters, including SEC issues in the US and Israel as well as overseeing the financial accounts. From 1992 to 2004, Mr. Czertok was the Chairman of the Control Committee of Friends of Rabin Medical Center, a multimillion dollar turnover facility where he was controlling all legal and financial proceedings.

In the past Mr. Czertok served as the legal advisor of the United States Consulate in Tel-Aviv. From 1976 through 1980, Mr. Czertok was the assistant district attorney of Tel-Aviv, representing the Attorney General in civil and criminal matters. From 1963 through 1973, Mr. Czertok was a director and owner of a public relations firm.

Currently, Mr. Czertok also serves as Chairman of the Israeli Bar Committees; is an active lecturer and publisher of various legal works; serves as President of the Parents Association for Soldiers; is a representative of the Israeli Bar Association in the Israeli Parliament; and is an examiner in oral bar exams as well as an acting Judge in the police disciplinary court and in the disciplinary court of the Israeli Journalist Association. He is a graduate of Tel Aviv University in Tel Aviv with an LLB degree and was severely wounded in the 1973 Yom Kippur War while a commanding officer in the Israeli Defense Forces fighting on the Syrian front.

Mr. Ben-Horrin has been largely engaged for over thirty years in Israel's Defense Forces and real estate industry. Since 2001, Mr. Ben-Horrin has directed, controlled and managed various real estate projects together with Bonei RMAG Ltd. and MPK Ltd. Between 1996 and 2001, Mr. Ben-Horrin managed real estate projects for Lear Or Ltd., and was an engineering consultant for Orik Ltd., a major construction company. From 1994 through 1996, Mr. Ben-Horrin served the Ministry of Construction and Housing of the State of Israel. Rising to the rank of Colonel in the Israel Defense Forces, Mr. Ben-Horrin served in various engineering and commanding posts from 1975 till 1992. Mr. Ben-Horrin earned a BSc degree in Mechanical Engineering from the Technion University in Haifa and a BA in Economics from the Bar-Ilan University in Ramat Gan.

Establishment of an Audit Committee

In reflecting the Company's commitment to good corporate governance practices and financial controls, XFONE, Inc. formed its Audit Committee which is comprised of Messrs. Czertok and Ben-Horrin, and Mr. Schemer Schwartz, an independent member of the Board since December 2002. Mr. Czertok was appointed as the Chairman of the Audit Committee.

"It was important for our Company to strengthen its corporate governance and financial controls with a Board composed of well experienced independent directors," stated Guy Nissenson, President and Chief Executive Officer of XFONE, Inc. "Given Arye's and Aviu's impressive credentials and expertise covering a broad spectrum of professional, managerial, financial and academic disciplines, XFONE is sure to greatly benefit from their leadership and guidance as we move forward with implementing our aggressive growth strategies and to prepare ourselves for pursuing a listing on a national exchange."

About XFONE, Inc.

A U.S.-domiciled corporation, XFONE 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.

This press release contains forward-looking statements. The words or phrases "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." Actual results could differ materially from those projected in the forward-looking statements as a result of a number of risks and uncertainties. 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. In addition, these and other factors may cause financials results to fluctuate from one financial quarter to another. Statements made herein are as of the date of this press release and should not be relied upon as of any subsequent date. The Company cautions readers not to place undue reliance on such statements. Unless otherwise required by applicable law, we do not undertake, and we specifically disclaim any obligation, to update any forward-looking statements to reflect occurrences, developments, unanticipated events or circumstances after the date of such statement.