AT&T Streamlining Organizational Structure.

Business Editors/High-Tech Writers

BEDMINSTER, N.J.--(BUSINESS WIRE)--April 9, 2003

AT&T today announced that it is streamlining its organizational structure to better serve customers and speed decision-making.

The streamlining effort reflects AT&T's transformation from its previous holding company structure to a more customer- and market-focused operating model following the spin-off of AT&T Broadband in November 2002 and the earlier spin-off of AT&T Wireless in July 2001.

The realignment represents an additional step on the path AT&T Chairman and CEO David Dorman set for the company when he assumed his current position in November 2002. At that time, he articulated AT&T's mission of being the preeminent networking and telecommunications services company in the world, with a relentless focus on meeting customer needs.

He emphasized that today's changes are not a short-term exercise driven by near-term financial demands, but rather part of AT&T's longer-term goal of changing the company's culture by pushing corporate functions down into the business and by putting a more horizontal leadership structure in place.

"This initiative is a critical component of a comprehensive transformation process we started before the Broadband spin-off last year," said Dorman. "We've benchmarked ourselves against the best companies in the world and aligned our resources squarely against our top priorities."

Reducing the layers of management will enable the AT&T leadership team to make quicker decisions based on customer needs. The management realignment will result in some job changes and eliminations as it is implemented.

"This streamlined structure helps us get even closer to our customers," Dorman said. "We're determined to keep leading the telecom pack today, and we're preparing now to lengthen that lead when the economy improves."

Today's changes support AT&T's move to a more customer-focused approach to running the business. For example:

-- Elevating the customer care teams in AT&T Business and AT&T

Consumer and building end-to-end responsibility for the total

customer experience into a new organization directly supported

by the head of each business unit;

-- Bringing the Billing Operations team into the Customer Service

organization, since billing is a critical element in AT&T's

customer-facing efforts;

-- Centralizing all of AT&T's major retail channels under a

unified customer-facing sales organization, with greater

accountability and enhanced market reach; and

-- Integrating all product management segments into a single

organization offering customers a seamless, integrated

solutions set over the company's full range of voice, data, IP

and managed services.

The realignment brings some management changes, effective immediately:

-- Chris Rooney will lead the Sales organization (described

above). Rooney, who had been president of AT&T Government

Solutions, is a veteran of the communications industry and a

proven sales leader. He succeeds Ken Sichau, who is retiring

after 17 years with the company.

-- Reed Harrison will lead Network Engineering and Operations,

the organization responsible for designing, operating and

maintaining the world's best network. Prior to today's

announcement, Harrison led network engineering, maintenance,

and field operations for AT&T's local, long distance and

global networks and products. He succeeds Frank Ianna, who has

indicated his desire to retire. Dorman and AT&T President

Betsy Bernard have asked that he delay his departure for a

period of time to assist in the transition, as well as manage

critical network and security issues, working closely with

Harrison.

The foregoing are "forward-looking statements" which are based on management's beliefs as well as on a number of assumptions concerning future events made by and information currently available to management. Readers are cautioned not to put undue reliance on such forward-looking statements, which are not a guarantee of performance and are subject to a number of uncertainties and other factors, many of which are outside AT&T's control, that could cause actual results to differ materially from such statements. For a more detailed description of the factors that could cause such a difference, please see AT&T's filings with the Securities and Exchange Commission. AT&T disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. This information is presented solely to provide additional information to further understand the results of AT&T.