AT&T  Inc.  (NYSE: T) announced today a contract  with  Microsoft Corp., the worldwide leader in software, services and   solutions.   AT&T  will  provide  co-location  hosting  and  Internet connectivity  for  its  newly  launched  Microsoft Exchange Hosted Services (EHS).  The  service  offers  fully  managed  messaging  services that help organizations  protect  themselves  from  e-mail-borne  malware,  satisfies retention   requirements   for   compliance,   encrypts  data  to  preserve confidentiality,  and preserves access to e-mail during and after emergency situations.  The  deal  creates a networking solution for the Microsoft EHS platform,  which  supports  AT&T Secure E-Mail Gateway service, to maximize performance for enterprise customers.

The  contract  with  AT&T  provides  Internet  Data  Center (IDC) space and Internet  connectivity  to support EHS services, including Hosted Filtering (policy,  anti-spam,  and  antivirus  message  filtering),  Hosted Archive, Hosted  Continuity,  and  Hosted  Encryption.  Leveraging the long-standing relationship  between  the  two  companies, Microsoft looked to AT&T for an expeditious implementation.

"AT&T is a trusted global provider of IP-based communications services with a  proven track record and Microsoft highly values this relationship," said Eron  Kelly,  director of Exchange Server Marketing at Microsoft Corp. "Our customers  rely  on  Exchange Hosted Services to help protect their network from  the  growing  number of viruses and spam, and we are thrilled to work

with AT&T to meet this demand."

AT&T's  Secure E-Mail Gateway Service, based on the Microsoft EHS platform, offers enterprise business customers a variety of benefits, including virus scanning,  content  filtering  and  spam  filtering.  These features enable enterprises  to  lower  their total cost of ownership of enterprise message security while off-loading its scarce IT resources.

"With our industry-leading global IP network, AT&T has a unique opportunity to  strengthen the Microsoft Exchange Hosted Services offering," said Chris Costello,  director of hosting and utility computing at AT&T. "We've worked diligently  to create an efficient and highly functional hosting portfolio, leveraging  the  assets  and  strengths of the new AT&T to meet the various needs of our clients."

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