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AT&T CEO SEES TDMA/GSM CONVERGENCE WITHOUT CDMA

WASHINGTON-AT&T Corp. head C. Michael Armstrong envisions a global wireless world where
Time Division Multiple Access and Global System for Mobile communications converge but TDMA and Code
Division Multiple Access technologies remain separate.

Armstrong, speaking last week at a luncheon sponsored by
the American Enterprise Institute, said he believes TDMA/GSM convergence would be relatively easy because TDMA
technology is common to GSM. Such a convergence would build on AT&T’s popular One Rate plan to create not only
nationwide calling plans but international calling plans.

The convergence will lead to a world where everything
happens over wireless telephony, Armstrong said. “Look ahead to the next-generation wireless technologies like
what we call the ‘world phone: ‘ As the name implies, one phone that will work globally, powered by a 1000-hour
battery, equipped with a 56 kilobit modem-activated with a touch of a thumb. And the generation after that, we’ll be
looking at wireless phones with a 384-kilobit modem to enable your phone to receive full-motion video-and still be
small enough to fit into a vest pocket,” he said.

This next generation of mobile communications is the
evolution that started with the cartridge pen, Armstrong said. “When I was in grade school, each student’s desk
was equipped with an ink well as the technology of writing hadn’t changed since the day of the quill pen. Then came a
new idea-a pen with its own ink cartridge built right into the barrel-and you could carry your ink well with you,
wherever you went. The cartridge pen-the first mobile communications system,” he said.

Armstrong does not
believe wireless telephony will replace wireline telephony but rather the two types of communications “will
coexist for a long time … [but] minutes of use will migrate because of convenience.” He illustrated this point by
saying that because he has a 600-minute bucket plan, he has been known to not get up from the chair at home to use the
landline telephone in the kitchen. Rather, he reaches into his pocket and uses his wireless phone. “I am lazy, and
it is convenient,” he said.

AT&T has a technology that could be seen as replacing the wireline, Armstrong
commented. Project Angel-a wireless local loop technology that could allow a person to be transferred from their home
service to their mobile service-will be a “viable market” for AT&T, Armstrong said. He said he hopes to
roll out full deployment of Project Angel in the near future but was not more specific.

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