StarMedia and Telet Today Launch Claro On-Line, a Mobile Internet Service Serving Brazil's Growing Wireless Market - Company Business and Marketing

Cambridge Telcom Report, March 20, 2000

StarMedia Network, Inc. (Nasdaq: STRM; http://www.starmedia.com), the leading Internet media company for Spanish- and Portuguese-speaking audiences worldwide, Wednesday announced an agreement with Telet, a cellular operator in the Brazil state of Rio Grande do Sul, to bring the power of the Internet to Telet's subscribers. The new service, Claro On-line, will provide Telet's 230,000 customers with Web services, including email as well as customized news content provided by StarMedia such as arts and entertainment, finance and horoscopes, which can be selected at http://www.claroonline.com.br.

"The mobile Internet has rapidly become a reality in Brazil. Since the launch of our first technology service in Brazil, at the end of last year, we have announced a total of four agreements with cellular operators to provide the technology and content for their customers," said Enrique Narciso, general manager of StarMedia Mobile. "Beyond information services and email, there is an enormous opportunity for the growth of e-commerce through wireless devices," added David Gilarranz, senior director, StarMedia Mobile.

StarMedia Mobile has previously announced agreements to provide technology and content to four cellular operators in Brazil, including Telemig Celular in Minas Gerais (http://www.celularonline.com.br), Amazonia Celular throughout five Northern states, ATL in Rio de Janeiro and Espirito Santo (http://www.atlexpress.com.br), and now Telet, with Claro On-line in Rio Grande do Sul (http://www.claroonline.com.br). Additionally, StarMedia Mobile recently created an exclusive partnership with EverSystems (http://www.eversystems.com.br), the leading Latin American provider of electronic banking solutions to bring the first complete pan-regional mobile banking offering to Latin America.

Strong growth is predicted for wireless services in Latin America. According to Dataquest report published in June 1999, there will be over 53 million mobile subscribers in Latin America this year. This number is expected to grow to approximately 128 million in 2003, representing a compound annual growth rate (CAGR) of 34% from 2000 to 2003.

Claro On-line consists of three separate features: Messages, which allows the user to receive text messages sent through http://www.claroonline.com.br; E-mail, which allows the user to receive messages and also send the same messages to others; and News, which allows users easy access to information on arts and entertainment, sports, finance, politics, and horoscopes among others. Users are able to customize their news preferences at the services web address, http://www.claroonline.com.br. The Claro On-line service will be available at no cost to all pre-paid customers until May 15, 2000 and can be activated through the Claro Digital website, http://www.claro.com.br.

Claro Digital

The Claro Digital began operations in the state of Rio Grande do Sul in February of 1999, and it continues the rapid expansion of its coverage area. Soon, it will be present in more than 120 municipal districts of Rio Grande do Sul. Today, Claro Digital is present in 110 cities in the State covering 75% of the State's population.

Telet

Telet is a Brazilian cellular operator, which offers the Claro Digital service. The company is supported by international groups with vast experience in telecommunications and has the most modern network of cellular digital services in Rio Grande do Sul.

StarMedia Network is the leading Internet media company targeting Latin America and other Spanish- and Portuguese-speaking markets worldwide. The Company is committed to providing Spanish and Portuguese speakers with a complete selection of services and products that take full advantage of Internet technologies. StarMedia Network is the owner of 10 leading brands: StarMedia.com, LatinRed, OpenChile, Panoramas.cl, Zeek!, Cade?, AdNet, Guia SP, Guia RJ, and Paisas.com. It also operates StarMedia Broadband, StarMedia Network's broadband services arm, and StarMedia Mobile, the Company's wireless division. Some of StarMedia Network's strategic relationships include Netscape Communications, RealNetworks, Billboard, CDNOW, Reuters, eBay, National Broadcasting Company, Hearst Communications, and Fininvest. Founded in 1996, the Company has operations in Argentina, Brazil, Chile, Colombia, Mexico, Puerto Rico, Spain, Uruguay, Venezuela, and major U.S. cities, and has over 700 employees.