AT&T Group President: China Can Reap Benefits of New Technologies

Country Needs to Make Even More Rapid Progress in Opening its Telecom Sector, Says AT&T Group President Forrest Miller

San Antonio, Texas, April 6, 2006, Hong Kong — Internet Protocol (IP) has revolutionized the global communications industry and can further benefit China as well, if the country is willing to introduce policies that better support competition and technology development, AT&T group president, Forrest Miller told executives from foreign and Chinese companies today.

In a keynote address to the American Chamber of Commerce, Mr. Miller urged the regulatory authorities in China to embrace the opportunities that IP creates to stimulate the economy through competition, while benefiting businesses and consumers.

“In effect, the twin forces of competition and IP technology are rocking — and eroding — the most traditional of companies, said Mr. Miller. ”And as is true in the U.S., they are compelling reasons for regulators and government authorities to re-examine and update their policies and governance models.

“China has its own fair share of important and timely issues. Just how the government will manage the telecom industry with a view toward acknowledging the forces of global competition is an ongoing debate,” Mr. Miller said. “Will the government, for example, ease the barriers for entry into the market? Will more interconnection options be created so that the needs of multinational companies can be better served?”

Comparing the situation in China with the U.S. telecom sector, Mr. Miller said the U.S. regulators were also finding it difficult to keep pace with the rapid changes taking place in the industry.

“While China is making noteworthy progress in opening markets since its WTO accession, there have been restrictive shifts as well, such as the licensing reclassification of International IP-VPN services from a value-added service to a basic service.”

Mr. Miller said that time and experience have proved that when telecom markets deregulate and become open to foreign competition and investment, it has the net effect of stimulating competition, encouraging innovation and driving prices down so that consumers and businesses benefit.

“And because telecom and communications are integral to every country and region, openness also has the effect of stimulating the overall economy. This stimulative economic impact is especially true for manufacturing or service industries that rely on telecom services to seamlessly integrate their global operations. Countries that retain tight regulatory control of new participants or new services risk falling behind. The risk increases when competing economies are moving on a steady path toward telecom liberalization.”

After meeting with employees and customers in Melbourne and Sydney, Mr. Miller flew to Beijing to meet with customers and staff, as well as industry partners before his address to the American Chamber of Commerce. His final stop is AT&T’s Asia Pacific headquarters in Hong Kong on April 6, before returning to the U.S.

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AT&T Inc. is one of the world’s largest telecommunications holding companies and is the largest in the United States. Operating globally under the AT&T brand, AT&T companies are recognized as the leading worldwide providers of IP-based communications services to business and as leading U.S. providers of high-speed DSL Internet, local and long distance voice, and directory publishing and advertising services. AT&T Inc. holds a 60 percent ownership interest in Cingular Wireless, which is the No. 1 U.S. wireless services provider with more than 54 million wireless customers. Additional information about AT&T Inc. and AT&T products and services is available at www.TheNewATT.com.

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Larry Solomon

AT&T Inc.

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