AMD and Alcatel Announce Technology Transfer Agreement for Advanced Broadband Communications Solutions.

AUSTIN, Texas and PARIS--(BUSINESS WIRE)--Feb. 12, 1998--AMD announced a collaboration with Alcatel to license and manufacture Alcatel's ADSL (Asymmetric Digital Subscriber Line) DMT (Discrete Multitone) technology for both "full-rate" and forthcoming ADSL "Lite" solutions. This alliance increases the availability of Digital Subscriber Line (DSL) products for the global telecommunications market.

Under the agreement, AMD will license and produce Alcatel's industry-standard ADSL DMT technology. ADSL technology provides a complete solution for simultaneous high-speed Internet access and voice traffic carried over the same telephone line. Alcatel's ADSL technology is integrated in a network architecture based on ATM (Asynchronous Transfer Mode).

"This agreement accelerates global acceptance of our pioneering technology," said Mr. Jozef Cornu, president and chief operating officer of Alcatel Telecom. "We believe that multisourcing of the technology is important for a rapid development of ADSL services. Alcatel will continue the development of DSL technologies and is introducing to the market a variety of networking products based on these technologies as part of its wide-ranging offering of world-class access products."

Alcatel has a leading position for the supply of ADSL equipment in the world market. In recent months, Alcatel has delivered and installed its ADSL equipment at more than 15 leading operators in the United States, Europe and Asia.

AMD, a leading provider of copper-based telephony silicon, will supply telecommunication OEMs with state-of-the-art high-speed data communications solutions as a result of this agreement. Additionally, AMD will create DMT-based ADSL products that add increased integration and value to telecommunications products at its newly developed design center in Dresden, Germany.

"Our work with Alcatel is an important step in enabling ADSL markets worldwide," said S. Atiq Raza, executive vice president and chief technical officer of AMD. "ADSL will become a significant market this year and this agreement will enhance AMD's focus on delivering usable bandwidth for access to the public Internet and corporate intranets at anytime from anywhere."

AMD also is adopting Alcatel's strategy for ADSL "Lite" and is working closely with industry standards groups to accelerate the adoption and availability of these services.

About ADSL

ADSL technology maximizes the potential of existing copper telephone lines to give access to data, video services and the Internet at speeds up to 150 times greater than 56-kilobit-per-second modems. ADSL achieves this throughput by carrying data traffic outside the voice band. Customers can still use their existing analog telephones and simultaneously use the "always on" high-speed connection to the Internet, corporate networks or multimedia services.

The Alcatel DMT chipset AMD will manufacture in this agreement achieves data rates of up to 8 megabits per second from the network to the user (downstream) and 640 kilobits per second from the user to the network (upstream). AMD expects to deliver these products in the second half of 1998. ADSL includes rate-adaptive capabilities, improved modem reach and performance, and industry interfaces like ATM.

About Alcatel

Alcatel, the Telecom segment of Alcatel Alsthom, designs, manufactures, and markets complete telecommunications systems. Activities include fixed switching networks, transmission systems, access systems, mobile communications infrastructure, business networking, submarine cable networks, as well as radiocommunications, space, and defense systems.

With operations in over 130 countries, Alcatel is a leading-edge supplier in the majority of its businesses. In 1997, these activities registered total sales of FF 82.9 billion (est.). Alcatel Alsthom trades on the Bourse de Paris and the New York Stock Exchange (NYSE: ALA). Visit Alcatel via the web at: http://www.alcatel.com.

About AMD

AMD is a global supplier of integrated circuits for the personal and networked computer and communications markets. AMD produces processors, flash memories, programmable logic devices, and products for communications and networking applications. Founded in 1969 and based in Sunnyvale, California, AMD had revenues of $2.4 billion in 1997. (NYSE: AMD). -0-

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CONTACT: AMD, Austin

Tom Kehoe, 512/602-2292

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or

Alcatel (North America)

Michael Newsom, 972/996-7896

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or

Alcatel (international)

AcJean-Christophe Huertas, Tel: [phone]

or

Alcatel Belgium

Karin Degroote

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