AT&T Network Upgrade Is Icing on the Cake for Hobby Lobby Stores

Oklahoma City, Oklahoma, October 11, 2006

AT&T Inc. (NYSE: T) today announced a new $6.7 million contract with Hobby Lobby Stores Inc., a leading retailer of arts and crafts with stores in 29 states. The three-year contract extends and expands a long-term relationship.

Under terms of the contract, AT&T will upgrade Hobby Lobby's network, delivering Multiprotocol Label Switching (MPLS) Private Network Transport (PNT) service to integrate the company's corporate headquarters with its nearly 380 Hobby Lobby stores across the country.

Additionally, AT&T's MPLS network solution will enable Hobby Lobby Stores to implement a leading-edge e-learning initiative designed to better serve customers and generate additional store traffic. The company will use the network to deliver educational video content to customers at store locations. AT&T's MPLS network prioritizes critical video traffic and delivers high-quality video, ensuring that Hobby Lobby's customers throughout the country will have a positive experience.

"Whether it's cake decorating, oil painting or making jewelry, our customers want to learn, and so our e-learning initiative is designed to deliver the best instructors and a wider array of subjects than we've ever been able to offer," said Richard Rozwalka, telecommunications manager and contract coordinator for Hobby Lobby. "This network upgrade will help us offer consistently high-quality instruction in a fun, relaxed atmosphere, which is a great way to strengthen the bond with our customers and spread the word about our stores."

By providing Hobby Lobby with a single unified network, the AT&T solution also dramatically increases bandwidth and data speeds, which enables Hobby Lobby Stores to reduce the time customers spend in line by streamlining and speeding up point-of-sale credit card transactions.

The contract includes other AT&T network and voice services, such as Managed Internet Service, a private self-healing SONET ring that serves Hobby Lobby's data center, Web hosting and local voice services.

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

About Hobby Lobby Stores Inc.
Based in Oklahoma City, Oklahoma, Hobby Lobby Stores has 378 stores in 29 states and is one of America's fastest growing arts and crafts chains. The privately held company projects sales of $1.65 billion in 2006. Additional information about Hobby Lobby Stores is available at www.hobbylobby.com.

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