AT&T Announces New Contract with ValleyCare Health System

Not-for-profit Health Care Provider Upgrades Services to Support New Applications

Pleasanton, California, January 29, 2007

AT&T Inc. (NYSE: T) today announced that AT&T has signed a new comprehensive network, data and voice services contract with ValleyCare Health System, a not-for-profit health care system serving residents of the Tri-Valley area and surrounding communities in Alameda County, Calif.

Under the terms of the five-year contract, AT&T will deliver Multi-Service Optical Network Ring (MON Ring) to ValleyCare Health System, enabling all of three of its campuses to share high-bandwidth clinical applications like electronic medical records (EMR) and pictorial archival communications systems (PACS). The MON Ring will offer ample infrastructure to support the storage area network (SAN), which is critical to disaster recovery and business-continuity planning.

Additionally, AT&T will be providing OPT-E-MAN® switched Ethernet service to support connectivity for Managed Internet Service (MIS). OPT-E-MAN makes possible a pure Ethernet solution for always-available Internet access. This solution will result in increased flexibility, which will accommodate the growing trend of Web-based clinical applications. In addition, the solution will also provide traditional voice and data services, such as T1, Primary Rate ISDN and toll-free services.

"With multiple locations throughout our health care system, we needed a provider with state-of-the-art technology to support advanced applications and link our multiple locations under one network," said Ken Jensen, chief financial officer, ValleyCare Health System. "We are confident that the solution provided by AT&T will sustain our current Web-based clinical applications with increased security, and provide the flexibility needed to implement future applications, such as E911, which will enable us to better serve our patients."

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About ValleyCare Health System
Since 1961, ValleyCare Health System has provided not-for-profit health care to the Tri-Valley and surrounding communities. Its highly skilled physicians, nurses and staff and state-of-the-art technology combine to bring patients health care that is at a world class level. Additional information about ValleyCare Health System is available at http://www.valleycare.com/index.html.

About AT&T
AT&T Inc. is a premier communications holding company in the United States and around the world, with operating subsidiaries providing services under the AT&T brand. AT&T is the recognized world leader in providing IP-based communications services to businesses and the U.S. leader in providing wireless, high speed Internet access, local and long distance voice, and directory publishing and advertising through its Yellow Pages and YELLOWPAGES.COM organizations. As part of its three-screen integration strategy, AT&T is expanding video entertainment offerings to include such next-generation television services as AT&T U-verseSM TV. Additional information about AT&T Inc. and the products and services provided by AT&T subsidiaries and affiliates is available at www.att.com.

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