Texans Benefiting from Exploding Broadband Investment, New Video Choice

“Texas Consumers Are Beginning to See the Real Fruits of Investment”

Keller, Texas, February 10, 2006, Video choice and hundreds of millions of dollars of broadband investment are coming to Texas faster than other states because of legislation passed last year by the Texas lawmakers, said Lea Ann Champion, AT&T senior executive vice president-IP operations and services.

At a Federal Communications Commission (FCC) hearing in Texas on video competition, Champion touted the Texas state bill, which eliminated barriers to broadband investment and enabled a clear path to deployment of AT&T’s U-verse services, bringing consumers an innovative new option for their TV and entertainment services.

“Last year, the Texas legislature passed a bill that encouraged investment in broadband and allowed video competition to emerge. The law is proof that, together, we can spur more video choice for consumers,” Champion said. “If there is one takeaway from today’s meeting, it is that Texas’s accomplishments can be replicated elsewhere,” she added.

Champion asked the FCC to establish a national policy to ensure that consumers have more options for their TV and entertainment services. “Removing the existing barriers to investment in video competition would be consistent with the broadband polices this Commission has traditionally endorsed. And consumers will benefit from innovation and choice,” Champion said. “I urge the Commission to remove entry barriers to investment and ensure that the same choice available for Texans is available throughout our country,” she added"

As a result of the Texas legislation, Champion noted that AT&T was able to commit without delay $800 million in new broadband facilities throughout Texas. That includes AT&T’s Project Lightspeed investment to bring new video choice to consumers. It also includes new DSL broadband service to all of the company’s 535 central offices and an additional 228 “neighborhood gateways,” bringing high-speed Internet access service to dozens of additional communities throughout the state.

This expansion of DSL also broadens the future availability of Homezonesm, AT&T’s joint venture with 2Wire to integrate satellite video with high-speed Internet access service. Importantly, these building blocks of investment allow AT&T to expand the reach of its broadband offerings to consumers, enabling the use of different technologies to bring video choice throughout AT&T’s service territory.

The Texas bill also protected and advanced the legitimate local interests of cities — items that AT&T supports: continuing to provide cities revenue from video service, offering community access programming (known as PEG), and confirming cities’ continued authority over rights-of-way management.

Through Project Lightspeed alone, AT&T is planning to make an investment of billions of dollars in the next three years in its network, operations, customer care, and IT infrastructure. Working with companies such as Alcatel, Microsoft, and Scientific-Atlanta, AT&T is deploying a two-way, interactive, switched IP video network and extending approximately 40,000 miles of new fiber optics to initially reach 18 million households by the end of 2008 — reaching more customers faster than any other company with a fiber deployment plan in the United States.

The company has begun a limited roll-out of its groundbreaking IPTV service, dubbed AT&T U-Versesm TV, in San Antonio and expects to deploy it on a broader scale later this year.

About the New AT&T
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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Andy Shaw

AT&T Inc.

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