@Home Network Reports Subscriber Base Grows to 210K

Upgraded Homes Passed Increases to 10M

@Home Revenue Increases by 50% During Quarter

REDWOOD CITY, Calif., October 13, 1998 -- @Home Network (Nasdaq: ATHM) today reported revenue totaling $13.8 million for the third quarter ended September 30, 1998, a 50% increase over revenue of $9.2 million reported in the second quarter ended June 30, 1998. The net loss for the third quarter was approximately $9.7 million, or $0.08 per share, compared to $11.1 million, or $0.10 per share in the second quarter of 1998. The company reported a gross profit of $1.6 million for the third quarter of 1998. Revenue and net loss for the third quarter of 1997 were $1.9 million and $11.9 million, respectively. Weighted average shares outstanding were 115.1 million for the quarter ended September 30, 1998, excluding shares reserved for outstanding warrants and employee stock options.

Revenue for the nine months ended September 30, 1998 was $28.8 million compared to revenue of $3.7 million for the nine months ended September 30, 1997. The net loss for the nine months ended September 30, 1998, before non-cash charges of $83.3 million taken in the first quarter of 1998, was $32.5 million, or $0.29 per share. This non-cash charge was related to the fair value of common stock warrants issued to cable system operators in connection with distribution agreements. Including this non-cash charge, the net loss for the nine-month period was $115.8 million, or $1.02 per share.

@Home's cable modem subscriber base has more than quadrupled since the beginning of 1998. At September 30, 1998, @Home served more than 210,000 cable modem subscribers across North America, an increase of 43% from 147,000 subscribers reported at June 30, 1998. The base of homes with access to two-way upgraded plant increased to 10 million at September 30, 1998 from 7.9 million at June 30, 1998. These numbers include Internet service subscribers served by new @Home affiliates that are currently being converted to the @Home service, as well as these affiliates' upgraded homes passed. In addition, during the third quarter of 1998, the @Home service was expanded in 13 new markets, raising the total number of active U.S. and Canadian markets to 44.

Based on @Home's 10 million upgraded homes passed, @Home reported an overall penetration rate of 2.1% at September 30, 1998. In many established markets penetration exceeds 5% and @Home is the second largest Internet/online service provider.

Commenting on the company's results, Tom Jermoluk, chairman, president and CEO of @Home Network, said, "We have long believed cable is the best broadband medium for residential Internet services, given its inherent high-speed, 'always-on' attributes. @Home is uniquely positioned to benefit from and drive market momentum as our 18 cable partners upgrade their networks and more consumers are able to enjoy our compelling, content-rich '@Home Experience'."

@Home commenced innovative marketing initiatives and programs to expand distribution, enhance market awareness and drive penetration during the third quarter. Significantly, @Home and Dell Computer Corporation announced an agreement in principle to integrate @Home's broadband Internet service experience with cable-ready Dell Dimension desktop PCs. Additionally, @Home launched a retail merchandising program that will make its high-speed Internet services available via authorized CompUSA outlets throughout North America. @Home also initiated a unique traveling marketing event dubbed "The Cable Internet Revolution Expo", targeting local @Home markets in 12 cities with hands-on demonstrations to promote and sell broadband Internet services. @Home also signed an exclusive affiliate agreement with Midcontinent Cable Co. to distribute high-speed cable Internet services to communities in North and South Dakota.

@Work continued to be a key contributor to @Home Network, ending the third quarter of 1998 with more than 1250 installed accounts, up 24% from the end of the prior quarter. Driving this growth, @Work made significant progress in expanding its broad array of Internet/Intranet related services which include Web hosting, server collocation, out-sourced email services, and multi-homing solutions.

@Media broadened its offerings to users, advertisers, retailers and consumers during the quarter. Through agreements with Intel, AT&T;, Bank of America, Johnson & Johnson, Levi Strauss, First USA and Toys-R-Us, @Home launched a program to create and define the next generation of online advertising. The program will measure and evaluate audience responsiveness with regard to brand recall, purchase intent, and acceptance of new broadband ad models. Additionally, @Media announced it teamed with Intel to develop "Making Pictures," a broadband portal to digital imaging, photography tools and educational resources. The division also expanded its content offerings during the quarter through agreements with providers such as The Weather Channel, WeatherLabs and Autoconnect.

Cash and short-term investments as of September 30, 1998 totaled $204 million and included $126 million raised in a public offering in August 1998. Capital expenditures in the third quarter of $6.6 million and for the first nine months of 1998 of $20.7 million supported the growth in the infrastructure necessary to roll out @Home and @Work services. Depreciation and amortization was $4.0 million and $10.3 million for the third quarter and first nine months of 1998, respectively.

Based in Redwood City, California, @Home Network (Nasdaq: ATHM) distributes high-speed interactive services to residences and businesses using its own network architecture and a variety of transport options including the cable industry's hybrid-fiber coaxial infrastructure. The cable connection provides users significant increases in speed over conventional Internet services. Leveraging the "always on" attribute of cable, @Home allows for unique multimedia applications that go beyond current Web experiences. Individuals seeking additional information about availability and subscription can refer to the @Home Network Web site (www.home.net). Since its founding in 1995, @Home Network has reached affiliate agreements with eighteen leading cable companies-worldwide, including Tele-Communications Inc., Cablevision Systems Corp., Comcast Corporation, Cox Communications, Bresnan Communications Company, Insight Communications, Jones Intercable, Garden State Cable, Cogeco Cable Inc., Lenfest Communications, InterMedia Partners, Marcus Cable, Midcontinent Cable Co., Century Communications, Rogers Cablesystems Limited, Shaw Communications, CasTel and Palet Kabelcom.

Traded on Nasdaq under the symbol ATHM, @Home Network is based in Redwood City, California. Additional information about @Home Network is available on the Internet at www.home.net.

This press release contains forward-looking information within the meaning of Section 27A of the securities Exchange Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and is subject to the safe harbors created by those sections. These forward-looking statements include statements related to @Home Network's ability to drive market momentum, the implementation of @Home Network's retail merchandising and OEM programs, and the success of @Home Network's next generation online advertising and "Making Pictures" initiatives. Actual results may differ materially due to a number of risks, including: numerous technological, operational and financial challenges; potential competition from other broadband Internet providers; and the degree of customer and industry acceptance for the @Home service. In addition, the proposed integration of @Home Network's service with Dell Computer Corporation's Dimension desktop PCs is contingent upon the parties' success in executing a definitive agreement, and there can be no assurance that such an agreement will be completed. The matters discussed in this press release also involve risks and uncertainties described from time to time in @Home Network's filings with the Securities and Exchange Commission. In particular, see the risk factors described in @Home Network's Form S-3 Registration Statement filed on August 12, 1998 and in its Form 10-Q for the quarter ended June 30, 1998. @Home Network assumes no obligation to update the forward-looking information contained in this press release.