NEW YORK and LONDON -- Verizon Communications (NYSE: VZ), and FLAG Telecom (Nasdaq: FTHL; LSE: FTL), a leading global network services provider and independent global carriers' carrier, today announced that they have entered into an agreement whereby FLAG Telecom will collaborate in the development and use of Verizon's recently announced city-to-city European backbone network. This advanced terrestrial fibre-optic network will provide connectivity to the major European business centres, and is expected to begin serving London, Paris, Amsterdam, Frankfurt, Dusseldorf and Brussels early in the second half of 2001. Expansion to other major European cities is planned during the remainder of 2001.

Tom Bartlett, President of Global Solutions Inc. (GSI), the Verizon business unit that will manage and operate Verizon's new global network, said: "We announced in February our plans to assemble and operate a global telecommunications network linking large US-based businesses with Europe, Asia and Latin America. The agreement we are announcing today is a key element in this global network plan, and we are pleased to be working with FLAG Telecom to implement its European connectivity. The network will greatly enhance our ability to meet the growing global needs of our broad customer base by providing seamless connectivity between the US and Europe."

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