Phonetime Releases Q3 Results-Year-to-Date Sales of $68.3 Million

MISSISSAUGA, ONTARIO (OTCBB: PHOEF), announced today that in the third quarter of 2007 it recorded the highest revenue of any single quarter in its history. Sales revenue for the quarter of approximately $24 million contributed to record a nine-month sales revenue of $68.3 million, representing a 350% increase over the same period in the prior year. The quarterly revenue was a 320% increase over the same quarter in 2006. This also continues a trend of quarterly revenue increases, as the revenue for the third quarter of 2007 exceeds by 4% the revenue for the most recent previous quarter.

From an income perspective, the Company experienced a loss in the third quarter of $833,000, which included non-cash expenses for stock-based compensation (options), amortization and future income taxes of $633,000 and $24,000 in interest expense. The operating loss resulted primarily from the rapid expansion of the Company's wholesale operations, which also contributed the bulk of the Company's revenue. Year-to-date, the Company had net losses of $1.7 million, which includes $1.8 million in non-cash items, being stock-based compensation amortization and future income taxes. However, in absolute dollars, Phonetime's Gross Profit for the third quarter of $2.4 million was $131,000 higher than in the same period of the prior year and for the year-to-date the Company's gross profit was $1.45 million - an increase of nearly 25% over the first nine months of 2006. A complete analysis of the third quarter and year-to-date results can be found in Phonetime's Q3, MD&A posted on www.sedar.com.

Wayne Silver, Phonetime's President & C.E.O. stated, "In the third quarter of 2007, we generated as much revenue as in the entire previous year. By the end of 2007, our Company's revenues are projected to be about $90 million. Due to the strong growth of our wholesale business over the past year, Phonetime has enhanced its global reputation in the telecom industry and many companies, including some of the largest carriers in the world, are now actively seeking to do business with us. Our results for the quarter and year-to-date reflect the scope of the opportunity represented by the growth of our wholesale operations. To develop this into a competitive operation for the long-term, we have invested significantly in building our network infrastructure and in human resources. We believe we are now well positioned to profitably grow this business and to generate increased returns for our shareholders".

Subsequent to the end of the third quarter, the Company announced its intention to acquire the privately held Symphony Telecom LLP (see press release dated October 2007). The acquisition is expected to close in the fourth quarter of this year. Symphony currently generates profitable revenue of approximately $60 million annually. It is a profitable and well-respected international wholesale telecommunications company with operations in South Africa and the USA. Symphony operates many direct routes in Africa and South East Asia, which will be highly complementary to Phonetime's existing network.

ABOUT PHONETIME

Established in 1994, Phonetime is a leading Canadian supplier of International Long Distance telecommunication services for individual consumers and businesses as well as wholesale long distance call delivery to large and small domestic and international carriers. Phonetime Inc. is publically traded, listed on the Toronto Venture Exchange (TSX VENTURE: PHD). Licensed in Canada as a Class A International Carrier by the CRTC, Phonetime operates one of the largest and most advanced private telecommunications networks in Canada. In Canada, Phonetime has 40 Points-of-Presence covering most major metropolitan areas, effectively offering on-net service to approximately 85% of Canada's population. Phonetime also has connections in 140 countries around the world, with facilities in London, England, and Frankfurt, Germany. The Company also has administrative offices in Florida.

Caution Regarding Forward Looking Information:

This press release contains forward-looking statements within the meaning of securities laws, including the "safe harbour" provisions of the Ontario Securities Act and the United States Private Securities Litigation Reform Act of 1995. Forward-looking information is often, but not always, identified by the use of words such as "anticipate", "believe", "expect", "plan", "intend", "forecast", "target", "project", "may", "will", "should", "could", "estimate", "predict" or similar words suggesting future outcomes or language suggesting an outlook.

Forward-looking statements and information are based on current beliefs as well as assumptions made by and information currently available to Phonetime concerning anticipated financial performance, business prospects, strategies and regulatory developments. Although management considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect.

By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks that predictions, forecasts, projections and other forward-looking statements will not be achieved. We caution readers not to place undue reliance on these statements as a number of important factors could cause the actual results to differ materially from the beliefs, plans, objectives, expectations and anticipations, estimates and intentions expressed in such forward-looking statements. These factors include, but are not limited to: incorrect assessments of value when making acquisitions; increases in debt service charges; fluctuations in foreign currency and exchange rates; inadequate insurance coverage; changes in tax laws; and Phonetime's ability to access external sources of debt and equity capital.

The foregoing list of factors that may affect future results is not exhaustive. When relying on our forward-looking statements to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Furthermore, the forward-looking statements contained in this press release are made as of the date of this press release, and Phonetime does not undertake any obligation to up-date publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. This cautionary statement expressly qualifies the forward-looking statements contained in this press release.

The TSX Venture Exchange has neither approved nor disapproved the contents of the press release.

Contacts: Phonetime Inc. Ian Hochberg Director (416) 505-4382 Email: ian@phonetime.com Phonetime Inc. Wayne Silver President & C.E.O. (905) 361-8304 Email: wayne@phonetime.com

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