1. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. Enabling the Cloud AT&T Margaret T. Chiosi Executive Director - Global Optical & Ethernet Service Development AT&T Labs MEF Board of Directors

2. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. Cautionary Language Concerning “Forward-Looking” Statements This presentation contains '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. These risk factors include the impact of increasing competition, continued capacity oversupply, regulatory uncertainty and the effects of technological substitution, among other risks. For a more detailed description of the factors that could cause such a difference, please see AT&T's 10-K, 10-Q, 8-K and other 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. 2

3. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. Agenda IT as a Utility – Cloud Services Cloud Requirements Software Defined Networks AT&T Cloud Services 3

4. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. IT/Network as a Utility From “The Big Switch Rewiring the World, From Edison to Google” by Nicholas Carr – In 1850s innovative industrialists (e.g. Henry Burden) had their own private power generators – By early 1900s, electricity became a utility service provided by a few companies to major companies and then the masses – We are at this same juncture in early 2000s 4

5. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. Network/IT as a Utility Power Utility Power grid Business Consumer Users AmazonGoogleiApple Internet Cloud Carrier 5

6. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. Is The Industry Moving Towards A Broadband Utility Model? 6 Source: Ethernet Executive Council State-of-the-Industry Survey Report, 4Q 2011, Heavy Reading Question: Do you agree with the following statement? At a macro level, carrier Ethernet standards and technologies are moving in the direction of enabling a broadband utility model in which (a) Ethernet serves as the unifying layer to virtualize access to the network, (b) high-capacity Ethernet and wavelength services function as transmission lines, and (c) large data centers play the role of power generation plants in the network. In this model, utility computing and storage capability are connected by low-latency Ethernet and wavelength services and are delivered to a customer – with an on-demand option – through a single Ethernet user network interface that can handle many applications with SLA guarantees. 87% agree 87% of respondents agreed that the industry is moving towards a broadband utility model, and only 2% disagreed.

7. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. Agenda IT as a Utility – Cloud Services Cloud Requirements Software Defined Networks AT&T Cloud Services 7

8. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. 8 Today Static Bandwidth/Attributes Static Ordering Multi-year Lease Future On Demand/Dynamic Network Services – Set profile (e.g. bandwidth, COS, latency, availability..) for a set duration of time – Activation - Secs, Mins, Days – Duration – Days, Months – Pay as you go Standard API – To provision (add, delete, change) network services – To collect Performance Management – To perform Fault Management – To provide Usage Information for Billing/Applications – To provide Network Information for Applications Cloud Market New Network Requirements

9. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. Agenda IT as a Utility – Cloud Services Cloud Requirements Software Defined Networks AT&T Cloud Services 9

10. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. What is SDN? Software-defined networking (SDN) – Enables network applications to request and manipulate services provided by the network and allow the network to expose network state back to the applications e.g. – Give video priority over e-mail – Create rules for traffic coming from or going to a certain destination – Quarantine traffic from a computer suspected of harboring viruses – Provides a way to try out new solutions in the mobility market 10

11. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. Transition to SDN (IETF/ITU) Custom Hardware OS API/NBI Feature 11 Apps

12. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. Transition to OpenFlow Custom Hardware OS Network OS Feature 12

13. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. Agenda IT as a Utility – Cloud Services Cloud Requirements Architecture Evolutions AT&T Cloud Services 13

14. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. AT&T Enables the Virtual Private Cloud Hybrid model Private/VPN connectivity Trusted logical separation Virtual Private Cloud Enterprise IT End Points Combining the security and performance of private cloud with the economics and flexibility of public cloud Storage Compute VPN Internet based Massive multi-tenancy Best-effort reliability Public Cloud Single tenant Dedicated infrastructure On-premises or hosted Private Cloud 14

15. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. 15 AT&T As a Service Strategy Deliver integrated content, applications and services to any device, anywhere, anytime End-to-end management Dynamic scaling Mobility integration Enterprise grade experience Integrated service delivery model Mobile Worker Enterprise Worker AT&T Network Fixed and Mobile Platform Hosting PaaS Public/Private/Hybrid Cloud AT&T Marketplace User experience/portal management Applications AT&T ISVs SaaS Partners Performance ● Security ● Reliability Management/ Integration/ Security Customer Benefits

16. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. HSPA+ on ~100% of the mobile network >LTE deployment to be completed by end of 2013 >200K Wi-Fi hotspots 3M mobile VPN endpoints AT&T Network: Premium Global Infrastructure Integrated Wireline and Wireless Network Provides Businesses with Secure Global Access AT&T’s Backbone Network Carries More than 28.9 Petabytes of Data Traffic on an Average Business Day MPLS-based Services in 182 Countries 3G Wireless Coverage in 145 Countries 916K fiber route miles worldwide 38 internet data centers on 4 continents Wired Ethernet from 1,646 access points 16

17. © 2012 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. 17