AT&T Selects LTE Equipment Suppliers

Agreements with Alcatel-Lucent and Ericsson Extend Existing 3G Relationships to Cover Planned Deployment of Next-Generation LTE Mobile Broadband Network

Dallas, Texas, February 10, 2010

newsrelease

AT&T Inc.* today announced the selection of Alcatel-Lucent and Ericsson as equipment suppliers for the planned deployment of its higher-speed LTE mobile broadband network.

The selection of the two suppliers paves the way for AT&T’s planned field trials of LTE technology later this year, with commercial deployment scheduled to begin in 2011. AT&T’s LTE rollout schedule aligns with industry expectations for development of LTE technology and widespread availability of equipment and compatible LTE mobile devices. The supplier agreements also complement AT&T’s plans to make the nation’s fastest 3G network even faster in advance of LTE networks and devices scaling, allowing the company to continue delivering the most advanced mobile broadband experience in the nation.

After testing equipment from multiple suppliers in the field and in a lab environment, AT&T chose to extend existing relationships with Alcatel-Lucent and Ericsson, which provide equipment for the AT&T 3G network today. Continued work with these two suppliers will enable AT&T not only to incorporate high-performance LTE equipment, but also to take full advantage of compatibility between the suppliers’ existing 3G equipment and forthcoming LTE upgrades. As part of the supplier agreements, 3G equipment delivered to AT&T by the suppliers starting this year will be easily convertible to LTE, enabling AT&T to upgrade existing equipment and software rather than install entirely new equipment in many cases as it deploys the next-generation technology.

LTE, or Long-Term Evolution, is the next generation of the existing GSM/UMTS mobile broadband technology platform that powers the AT&T 3G network today. LTE technology could eventually deliver higher mobile broadband throughput and lower latency than today’s 3G networks, helping to drive continued growth of powerful mobile applications and advanced devices. AT&T customers will also benefit from compatibility, with devices expected to interoperate between 3G and LTE networks.

“The selection of Alcatel-Lucent and Ericsson is an important step forward in our ongoing mobile broadband strategy, which is focused on delivering the best possible combination of speed, performance and available devices for customers at every level of technology deployment,” said John Stankey, president and CEO, AT&T Operations. “AT&T has a key advantage in that LTE is an evolution of the existing GSM family of technologies that powers our network and the vast majority of the world’s global wireless infrastructure today. As some competitors move away from their existing investment in niche 3G platforms, we are able to efficiently and quickly move toward LTE while enhancing our existing 3G performance and providing access to a strong ecosystem of customer devices.”

“With this important step, AT&T is sending a clear and strong signal about its commitment to the evolution of the broadband wireless networks and to supporting the next generation of mobile applications. We look forward to joining AT&T on this journey and see this as a starting point for further collaboration with AT&T to deliver an end-to-end IP solution for mobile broadband,” said Alcatel-Lucent CEO Ben Verwaayen. “This announcement expands on our long-standing relationship with AT&T – one that covers everything from 3G HSPA infrastructure to network monitoring and management – and speaks volumes about the confidence and trust they have in our leadership in LTE technology and our ability to deliver a smooth end-to-end migration path to LTE.”

“Our ability to work together to meet the demands of a rapidly changing market has been a crucial element in gaining AT&T’s continued confidence,” said Hans Vestberg, president and CEO, Ericsson. “We will work just as hard to secure a smooth rollout of LTE and support AT&T in introducing new consumer and business services moving forward."

As part of the agreements, AT&T has designated Alcatel-Lucent and Ericsson as the domain suppliers for its Radio Access Network Domain. The multi-year agreement covers radio access network equipment needed to deliver LTE service. This equipment will be deployed at cell sites across AT&T’s network to enable LTE speeds and functionality. Financial terms of the supplier agreements were not disclosed.

AT&T’s Domain Supplier program, launched last September, facilitates a more collaborative relationship with its equipment and software suppliers, enabling AT&T to have best technologies in place to serve its customers. The program is also designed to ensure that the company’s network technology investment accelerates AT&T’s move toward a network that is well-equipped for the future.

The evolution to LTE is part of AT&T’s ongoing efforts to innovate and invest in mobile broadband. AT&T today serves twice the number of smartphone customers as its nearest competitor, and this smartphone leadership has resulted in mobile broadband traffic that has grown more than 5,000 percent over the past three years. Smartphones are just one example of innovation made possible by investment in mobile broadband.

AT&T in January announced total 2010 capital expenditures are expected to be between $18 billion and $19 billion. These plans include an increase of approximately $2 billion in wireless network and backhaul investment, which will help ensure continued strong results in 3G network performance as well as preparation for planned deployment of LTE.

Earlier this year, AT&T upgraded 3G cell sites to HSPA 7.2 technology. Over the course of 2010 and 2011, AT&T plans to combine this upgrade with enhanced fiber-optic backhaul connectivity, which will support a considerable boost in 3G speeds as well as future LTE service. AT&T offers a total of 10 HSPA 7.2-compatible devices today, enabling millions of customers to immediately take advantage of faster 3G speeds as backhaul is deployed. In contrast, LTE devices are still in development today and are not expected to be widely available until 2011.

This upgrade strategy will enable customers to experience a significant boost in 3G speed well ahead of the time when an LTE ecosystem with handsets is available. As LTE is deployed, HSPA 7.2 and supporting backhaul will provide a much more robust 3G network experience when users move outside of locations covered by next-generation networks. In contrast, competitors who are not upgrading their 3G networks will be unable to provide faster mobile broadband speeds for smartphones until next-generation devices are available.

AT&T wireless network investment plans for 2010 also include construction of about 2,000 new cell sites and adding new radio controllers and carriers at a pace that doubles deployment in 2009.

*AT&T products and services are provided or offered by subsidiaries and affiliates of AT&T Inc. under the AT&T brand and not by AT&T Inc.

About AT&T
AT&T Inc. (NYSE:T) is a premier communications holding company. Its subsidiaries and affiliates – AT&T operating companies – are the providers of AT&T services in the United States and around the world. With a powerful array of network resources that includes the nation’s fastest 3G network, AT&T is a leading provider of wireless, Wi-Fi, high speed Internet and voice services. AT&T offers the best wireless coverage worldwide, offering the most wireless phones that work in the most countries. It also offers advanced TV services under the AT&T U-verseSM and AT&T | DIRECTVSM brands. The company’s suite of IP-based business communications services is one of the most advanced in the world. In domestic markets, AT&T’s Yellow Pages and YELLOWPAGES.COM organizations are known for their leadership in directory publishing and advertising sales. In 2009, AT&T again ranked No. 1 in the telecommunications industry on FORTUNE® magazine’s list of the World’s Most Admired Companies. Additional information about AT&T Inc. and the products and services provided by AT&T subsidiaries and affiliates is available at http://www.att.com.

© 2010 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies.

Additional information about AT&T Inc. and the products and services provided by AT&T subsidiaries and affiliates is available at http://www.att.com. This AT&T news release and other announcements are available at http://www.att.com/newsroom and as part of an RSS feed at www.att.com/rss. Or follow our news on Twitter at @ATTNews. Find us on Facebook at www.facebook.com/ATT to discover more about our consumer and wireless services or at www.facebook.com/ATTSmallBiz to discover more about our small business services.

Cautionary Language Concerning Forward-Looking Statements
Information set forth in this press release contains financial estimates and other forward-looking statements that are subject to risks and uncertainties, and actual results might differ materially. A discussion of factors that may affect future results is contained in AT&T’s filings with the Securities and Exchange Commission. AT&T disclaims any obligation to update and revise statements contained in this news release based on new information or otherwise.