BT And Yahoo! Extend Broadband Partnership

Companies Deepen Alliance to Offer Co-Branded Service to All BT Broadband Customers

Sunnyvale, CA & London, UK -- October 14, 2005 -- BT and Yahoo! (NASDAQ:YHOO - News), a leading global Internet company, today announced they have signed a long-term extension of their strategic broadband partnership. The companies have also expanded their alliance to offer all new and existing BT Broadband customers the Yahoo! broadband experience starting on October 24, 2005.

BT Broadband with Yahoo! combines Internet access with an exclusive co-branded Internet experience and a full range of Yahoo!’s leading tools and services. All BT Broadband customers across all four of their new broadband options will now receive services including a premium level customizable radio station, access to the Web’s largest catalogue of music videos streamed at higher bit rates, a personalized broadband homepage with access to more than 750,000 content sources from across the Web, award-winning premium e-mail with industry-leading spam protection with 2 gigabytes of storage for primary accounts and more.

“We have raised our game again by giving all customers access to the award winning premium Yahoo! broadband experience which highlights the kind of unique content and superior security features which give customers peace of mind,” said Gavin Patterson, BT group managing director, Consumer, BT. “BT has decided to forge deeper links with Yahoo! and enhance the features available across their broadband portfolio in order to offer customers better value.”

“We are excited to extend our successful alliance with BT and now bring the best experience, security and value on the Internet to all of the BT Broadband options. This deal reinforces our standing as the partner of choice for leading broadband providers,” said Steve Boom, Yahoo! senior vice president Broadband. “BT and Yahoo! are focused on delivering the best possible services to consumers and we are delighted that the expansion of our relationship with BT now brings the Yahoo! experience to all of BT’s broadband customers.”

The alliance between BT and Yahoo! was first announced in June 2003 and the co-branded broadband service launched for consumers in September 2003. In March 2004 the two companies announced the creation of BT Communicator with Yahoo! messenger, a next-generation call management offering based on the Yahoo! instant messaging platform.

About BT
BT is one of the world’s leading providers of communications solutions serving customers in Europe, the Americas and Asia Pacific. Its principal activities include networked IT services, local, national and international telecommunications services, and higher-value broadband and internet products and services.

BT consists principally of three lines of business:

* BT Retail, providing a comprehensive range of communications and related services to more than 20m UK consumers and businesses.

* BT Wholesale, providing network services and solutions within the UK to more than 600 fixed and mobile operators and service providers including the provision of broadband and private circuits.

* BT Global Services, providing networked IT services to meet the needs of multi-site organisations globally. BT Global Services operates in more than 130 countries and also offers international carrier services.

In the year ended 31 March 2005, BT Group’s turnover was £18,623 million with profit before goodwill amortisation, exceptional items and taxation of £2,085 million.

BT Group plc is listed on stock exchanges in London and New York. British Telecommunications plc (BT) is a wholly-owned subsidiary of BT Group and encompasses virtually all businesses and assets of the BT Group.

For more information, visit www.bt.com/aboutbt

About Yahoo!
Yahoo! Inc. is a leading provider of comprehensive online products and services to consumers and businesses worldwide. Yahoo! is the No. 1 Internet brand globally and the most trafficked Internet destination worldwide. Headquartered in Sunnyvale, Calif., Yahoo!’s global network includes 25 world properties and is available in 13 languages.

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Kristen Wareham

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Yahoo! Inc.

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