AT&T* today announced it will begin selling iPhone 3G S for $199 (16GB) and $299 (32GB) and iPhone 3G starting at $99 (8GB) to new and qualifying customers who sign up for a 2-year service commitment with voice and data plans. Customers will be able to purchase iPhone 3G at its new price through AT&T’s company-owned retail stores beginning at approximately 5 p.m. ET today and at www.att.com/iPhone later this evening. iPhone 3G S is available for preordering today and will be in stores on June 19.

AT&T reaffirmed its financial guidance for 2009 that targets wireless service OIBDA (operating income before depreciation and amortization) margins in the low 40% range. AT&T’s cost of customer acquisition for iPhone 3G S and the newly priced iPhone 3G are expected to be very similar to the costs associated with the original iPhone 3G.

AT&T customers with integrated devices like iPhone 3G and iPhone 3G S offer attractive ARPU’s (average monthly revenues per subscriber) and low churn rates. In the first quarter, AT&T’s iPhone activations totaled more than 1.6 million, more than 40 percent of them for customers who were new to the company.

*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 coverage worldwide, offering the most wireless phones that work in the most countries. It also offers advanced TV services under the AT&T U-verse^SM and AT&T | DIRECTV^SM 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.

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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.

NOTE: OIBDA is defined as operating income (loss) before depreciation and amortization. OIBDA differs from Segment Operating Income (loss), as calculated in accordance with generally accepted accounting principles (GAAP), in that it excludes depreciation and amortization. OIBDA does not give effect to cash used for debt service requirements and thus does not reflect available funds for distributions, reinvestment or other discretionary uses. OIBDA is not presented as an alternative measure of operating results or cash flows from operations, as determined in accordance with GAAP. Our calculation of OIBDA, as presented, may differ from similarly titled measures reported by other companies.