Wednesday, December 13, 2000

I've been asked may questions recently about the restructuring of AT&T. Most of the questions revolve around how the restructuring plan will affect my company, AT&T Broadband, and the impact on our customers.

My answer is simple: The restructuring of AT&T will strengthen our commitment to our customers, and amplify our efforts to provide them with great new products and services on an accelerated basis.

We're proud of the progress we've made in recent months in building a company designed to serve customers with a full range of exciting services in entertainment, information and communications. We've worked long and hard to make our company the Broadband "provider of choice" for consumers. During the past two years, we've merged two smaller cable companies Tele-Communications Inc. (TCI) and MediaOne and unified them under the AT&T banner. We've made a substantial investment in upgrading and rebuilding our networks. We've strengthened our management teams by recruiting new, dedicated, and diverse people with fresh ideas. And we've focused on tools and systems to provide the highest quality customer care and service.

In many ways, these strides have positioned us well to start this new chapter in our progress. The restructuring of AT&T will enable us to expand this important work, while realizing greater value for shareholders. Meanwhile, we'll endeavor to live up to the fine traditions and attributes of the AT&T brand.

One of our major goals of the last few years has been to better use the substantial capacity of our broadband technology to bring new and valuable services to customers. AT&T's commitment to this process has helped us accelerate the deployment of affordable, fully-featured digital telephone service, high-speed Internet access services, and many new video channels in our digital cable service.

The beauty of our broadband network is that, as our upgrades are completed, we're able to bring these services to customers over a single wire, at an affordable price.

This work was challenging at the outset. It meant major system construction in many of our service areas, implementation of new processes and procedures, education of our customers, and new technical training for our personnel.

We've conquered many of these challenges, and we've had great success in rolling out our new services. Currently, we're providing digital cable service to about 2.5 million customers. The number of customers for our high-speed Internet access services exceeds one million. And we'll end 2000 with more than a half-million customers for our digital telephone service, which in most communities is the first-ever competition to the incumbent local telephone monopoly.

That commitment to local telephone service is key. Some skeptics have argued that our restructuring plan will cause us to lose our appetite for providing phone service. Not so. In October alone, we added 65,000 new telephone customers. That number will get larger every month, as we move into serving millions of telephone customers in 2001 and the years ahead. The type of network that we've constructed with its huge capacity makes telephone service a natural and desirable product for us, and for our customers.

Here in metropolitan Atlanta, we've demonstrated progress in several areas. Our $500-million rebuild and upgrade, one of the largest projects in the nation, is 84 percent complete and will be finished at the end of 2001. This new network is making digital television and high-speed Internet services available in more than 80 percent of our service area.

Close to 60 percent of our service area now has access to our local telephone service, priced 26 percent lower than our competition. We are also excited about video-on-demand, a service now being tested with select customers in Cobb County. We intend to offer this new service to all of our Atlanta customers in 2001.

Across the country, the number of service installations we're performing is increasing every day. And we'll keep the process rolling this coming year, in an effort to help you realize the benefit of our broadband technology.

Our predecessor companies were pioneers in the introduction of broadband services. AT&T's ownership has enabled us to institutionalize these innovations and bring them to customers on a broad scale. There's no turning back. It's full-speed-ahead for AT&T Broadband, as we put our broadband technology to work, to help improve the way you live work, and play.

Steve White

Senior Vice President

AT&T Broadband, Atlanta Region

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