Microsoft and Telmex Joint Venture, T1msn, to Acquire Yupi Internet, Accelerating Expansion in U.S. Hispanic Market

REDMOND, Wash., and MEXICO CITY, June 21, 2001 — T1msn, a joint venture between Microsoft Corp. and Telmex, today announced the launch of its Spanish-language portal for the U.S. Hispanic market, with the announcement of plans to acquire Yupi Internet Inc., a leading portfolio of Spanish-language Internet sites. Building on momentum of the number of U.S. Hispanics visiting MSN® and T1msn’s No. 1 reach in Mexico, and the No. 1 position of MSN Hotmail® with Spanish-speaking users in Latin America, T1msn is launching Yupi/MSN, a Spanish-language portal. Through the acquisition, T1msn, whose audience has grown to more than 5 million unique users since its launch just over a year ago, is expanding its services to all Spanish-speaking consumers in the United States and Latin America.

“MSN and Yupi share a vision of bringing the richest and most diverse Internet experience to Spanish speakers throughout the Americas,”
said Yusuf Mehdi, vice president of MSN and the Personal Services Business Group at Microsoft.
“The strong MSN portfolio of integrated Internet services, such as MSN Hotmail and MSN Messenger, will combine with leading Spanish content from T1msn and the unique, rich content that Yupi provides to offer a premier online service for Spanish-speaking consumers in U.S. Hispanic and Latin American online markets.”

“T1msn has a solid reputation of delivering unique Spanish-language content to consumers, and Telmex has expertise in understanding U.S. and Latin American consumers as well as proven experience in sales and marketing in both regions,”
said Arturo El
as Ayub, chairman of the board at T1msn and vice president of Strategic Ventures, Communication and Institutional Relations at Telmex.
“With the talented team and compelling offerings provided by the Yupi network, I am confident that together we will create the most rewarding Internet experience for Hispanic consumers and become the leading Internet destination for Spanish-speaking users in the Americas.”

Under the terms of the acquisition, Yupi Internet will combine with T1msn’s operations and the new company will operate as T1msn in Mexico and as Yupi/MSN in other North and South American markets. T1msn will continue to offer users services such as MSN Messenger Service and the MSN Hotmail Web-based e-mail service, which has nearly 8 million consumers using the service in Spanish. This will be supplemented by the range of Spanish-language content offered by Yupi, which includes local news sites for Spanish-speaking consumers and a specialized site focused on the interests of Spanish-speaking women.

“As part of the T1msn and MSN family, Yupi solidifies its leadership position among Spanish-speaking Internet users,”
said Oscar Co
n, president and CEO of Yupi Internet.
“Our collective users will now enjoy the best-in-class services, content and technology of MSN, and our combined business partners will further benefit from our custom-tailored online marketing solutions to effectively reach our large Spanish-speaking audiences across the Americas region.”

T1msn, in combination with Yupi, will be well-positioned with both the U.S. Hispanic population, one of the fastest-growing Internet segments in the United States, and Latin America, whose online population is expected to soar from 22 million in 2000 to 77 million in 2005 according to Jupiter Media Metrix Inc. In addition, the new operation will continue to establish and deepen its relationships with marketers and business partners, which have products and services to offer this growing audience. As a result, marketers will be able to purchase space regionally, in Spanish, helping them reach their target audience across the Americas on MSN.

“T1msn is a success story in Mexico, reaching the leading position among Mexican portals in only one year and further strengthening its commitment to Spanish-speaking users today,”
said Gerardo Villarreal, CEO of T1msn at Microsoft.
“Both T1msn and Yupi have complementary, high-quality content. With this acquisition, we will make the Internet an enjoyable place for Spanish speakers throughout the Americas.”

About T1msn

T1msn is a Spanish-language Internet gateway, specifically designed for the Hispanic community and enabling users to communicate with each other, and to search, buy and sell more effectively, because it has the support of Telmex and Microsoft, two leaders in communications and technology. T1msn offers its users diversified content plus the best Internet services available in Spanish. T1msn offers consumers valuable content through a unique concept, which consists in gathering the best content providers from the most diverse fields, to offer users truly pluralistic information and services that conform to their needs. It currently counts 70 content partners in 16 channels.

About Yupi Internet

Yupi Internet Inc. was founded in May 1996. Its flagship portal site, ( ), was created in response to the great need for high-quality Spanish-language content and services in a user-friendly format on the World Wide Web. In 1999, Yupi enhanced its offering through the acquisition of CiudadFutura ( ), one of the world’s first Spanish-language online communities, which continues to be supported by over 200 webmasters from around the world. Yupi is committed to bringing the best that the World Wide Web has to offer to Spanish-speaking Internet users and to providing marketers with unique and effective opportunities to reach targeted audiences. For example, the Yupi portfolio features ( ), a specialized site catering to the interests and needs of Spanish-speaking women. Yupi also offers a fast-growing selection of sites dedicated to localized news, content and services. and its network of sites are headquartered in Miami Beach, Fla. More information on can be found at ( ).

About Telmex

Telmex is the leading communications company in Mexico with more than 12 million telephone lines in service, offering telecommunications services through a 68,000-kilometer fiber-optic digital network. Telmex and its subsidiaries offer a wide range of advanced telecommunications, data and video services, and Internet access as well as integrated telecom solutions for corporate customers like Data Connectivity and Internet Data Centers Infrastructure. Today Telmex is the telecommunications solutions provider leading in Mexico between products designed for all population segments. Additional information on Telmex is available on the Telmex Web page at .

About MSN

MSN is the world’s most popular destination on the Web, attracting more than 230 million visitors per month. Available in 33 markets and 17 languages, MSN provides consumers with their home on the Web – where they can get everything they need from the Web and make the most of their time online. MSN is a world leader in delivering Web services to consumers and digital marketing solutions to businesses worldwide. MSN is located on the Web at .

About Microsoft

Founded in 1975, Microsoft (Nasdaq
) is the worldwide leader in software, services and Internet technologies for personal and business computing. The company offers a wide range of products and services designed to empower people through great software — any time, any place and on any device.

Microsoft, MSN and Hotmail are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries.

The names of actual companies and products mentioned herein may be the trademarks of their respective owners.

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