TPI shareholding-sale process

Telefonica SA
30 March 2006


TELEFONICA S.A., as provided in article 82 of the Spanish Securities Market
Act (Ley del Mercado de Valores), hereby reports the following:

In light of the information published in the newspapers today in relation to the
private sale process of TELEFONICA S.A.'s shareholding in TELEFONICA
PUBLICIDAD E INFORMACION, S.A. (TPI), the Company wishes to clarify that the
seven non-binding proposals presented by participants in the sale process are
below the TPI share price as at the close of 29 March. It must also be stated
that the aforementioned non-binding offers are only the first phase of the sale
process and are not indicative of the final price which may be offered.

In accordance with the calendar for the process, the Company hopes that possible
binding offers will be presented in the second half of April. The Company will
analyse these offers once received, but does not rule out considering other
strategic alternatives in relation to its holding in TPI.

Madrid, March 30th, 2006



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