AT&T Announces New Contract with Alisal Union School District

Salinas, California, June 30, 2006

AT&T Inc. (NYSE: T) today announced a new optical services contract with Alisal Union School District (AUSD), which includes 11 schools located in Salinas, Calif. Under the terms of the contract, AT&T will supply a Customized Switched Metro Ethernet (CSME) solution and support services to all 11 schools and the district office. The services will be used to deliver reliable high speed access to innovative and interactive teaching and learning applications across the district. In addition to local and long distance voice services, AUSD will also enjoy faster Internet connection speeds with increased security and reliability through the converged network infrastructure.

The new services will increase the district's bandwidth by supplying fiber links to the school sites for system image updates and remote administration for greater efficiency among faculty and staff. The services will further enable server and application consolidation, enabling quick transfer of voice and video data over a converged wide area network (WAN). As a result, the AUSD expects a richer educational experience for its students. AT&T is the district's primary service provider of core telecommunications services and Internet service.

"This service will allow us to focus on delivering educational strategies to the schools to enhance their teaching resources." said Jess Stephens, director of technology, Alisal Union School District. "Classroom instructors will be able to use audio, video, high speed Internet, interactive software and a multitude of resources to reach our students. We are confident that the solution provided by AT&T will meet our current technical needs and provide a robust path for future curricular needs."

About Alisal Union School District
Alisal Union School District includes 11 schools throughout the eastern portion of Salinas, California. Additionally, the district features adult education, migrant education, extended learning, special education, and alternative education programs, as well as a charter school. For more information, visit www.alisal.org.

About 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 55.8 million wireless customers. Additional information about AT&T Inc. and AT&T products and services is available at www.att.com.

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