AT&T Announces Intention to Withdraw From Pay Phone Business by End of 2008 Growing Availability of Alternative Communications, Especially Wireless,

Has Led to Decline in Demand for Pay Phone Services



    SAN ANTONIO, Dec. 3 /PRNewswire-FirstCall/ -- AT&T Inc. (NYSE:   T)
 announced today plans to exit the shrinking pay phone business by the end
 of 2008. Existing contracts and customer service commitments will continue
 to be honored during the period that the business is being phased out.
 
     AT&T's Public Communications unit has continued to experience
 significant pressure from reduced pay phone usage, primarily as a result of
 the growth of alternative communications choices, such as wireless phones
 and personal communication devices.
 
     The company plans to phase out both public pay phones and phones
 provided under contracts at government correctional facilities through the
 end of next year. All customers will receive advance notification of
 specific plans as well as information on other potential providers and
 product options.
 
     The move affects AT&T pay phones in the company's traditional 13-state
 service area only. BellSouth Corp., which was acquired by AT&T Inc. in late
 2006, had previously exited the pay phone business in its nine-state
 service area. AT&T's wholesale pay phone services are not affected.
 
     Public Communications will honor all existing customer contract terms
 and conditions while continuing to provide excellent customer service
 throughout the withdrawal process.
 
     "This is the right time for us to take this step on behalf of our
 customers, employees and stockholders," said David Huntley, senior vice
 president for Customer Information Services. "We expect that independent
 providers will pick up much of this business, and, as we exit the business,
 we will be able to refocus our resources to areas that offer stronger
 growth potential and greater opportunity for the company."
 
     Pay phones in the United States have declined across the industry from
 about 2.6 million phones in 1998 to an estimated 1 million phones today.
 
     Huntley said the company will be attentive to the needs of both
 customers and employees during the 13-month process of phasing out the
 business.
 
     Current AT&T Public Communications customers may call 800-809-0878 with
 questions.
 
     Note: This AT&T release and other news announcements are available as
 part of an RSS feed at http://www.att.com/rss.
 
     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. Among their
 offerings are the world's most advanced IP-based business communications
 services and the nation's leading wireless, high speed Internet access and
 voice services. In domestic markets, AT&T is known for the directory
 publishing and advertising sales leadership of its Yellow Pages and
 YELLOWPAGES.COM organizations, and the AT&T brand is licensed to innovators
 in such fields as communications equipment. As part of its three-screen
 integration strategy, AT&T is expanding its TV entertainment offerings.
 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.
 
     (C) 2007 AT&T Intellectual Property. All rights reserved. AT&T and the
 AT&T logo are trademarks of AT&T Intellectual Property. For more
 information, please review this announcement in the AT&T newsroom at
 http://www.att.com/newsroom.
 
 
 

SOURCE AT&T Inc.
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