Date of Release: 2005-12-19

AT&T Inc.

Confirms Long-Term Ratings at “A”

Dominion Bond Rating Service (“DBRS”) has today confirmed the long-term ratings of AT&T Inc. (“AT&T Inc.” or the “Company”) at “A“ and Commercial Paper at R-1 (low), after the Company announced its intention to guarantee three additional notes of AT&T Corporation (“AT&T”) that total US$4.5 billion. All trends remain Stable.

Given AT&T Inc.’s current strong financial position, the additional guaranteed debt does not appear to have any major implications on the current “A” rating. However, DBRS does acknowledge with the further guarantee of AT&T’s debt, AT&T Inc. is now more legally exposed to the competitive pressures and credit implications of having a subsidiary with significant enterprise operations, where competition still remains intense.

Notwithstanding the above, DBRS has confirmed AT&T Inc.’s rating based on the expectation that AT&T Inc. will be able to integrate AT&T into its corporate structure and extract further synergies, thus reducing some of the concerns associated with AT&T’s competitive environment. In addition, DBRS does expect further improvements from the Company’s 60% ownership of Cingular Wireless LLC (“Cingular”), whose acquisition of AT&T Wireless Inc. closed approximately one year ago. Therefore, AT&T Inc. is expected to benefit from stronger wireless business dynamics on the consumer side going forward, as well as providing integrated fixed/wireless solutions to its enterprise customers, both in region and out of region, through AT&T. Therefore, DBRS believes that, through successfully leveraging its recent acquisitions, AT&T Inc. can mitigate the increased operational risk of the enterprise segment and increasing competition within its core consumer franchise.

However, DBRS does note that AT&T Inc. faces execution risk in integrating two major acquisitions and, despite its robust financial profile, further rating action could occur if major operational improvements do not materialize or the rate of competition intensifies. Therefore, the Company will need to execute flawlessly over the near term and DBRS will continue to monitor the integration process at both AT&T and Cingular.

Note: These ratings are based on public information.

DBRS's rating definitions and the terms of use of such ratings are available at www.dbrs.com.