@Home Network to Create Internet Backbone with Initial Capacity for 5 Million Broadband Users

AT&T; Awarded Contract; Backbone Capacity will Scale to Support Ubiquitous Broadband Services Throughout North America Over Next 10 Years

REDWOOD CITY, Calif., January 6, 1999 - @Home Network (Nasdaq: ATHM), the leading provider of high-speed Internet services via the cable infrastructure, today announced a long-term agreement with AT&T; to create a nationwide Internet Protocol (IP) network utilizing AT&T;'s Dense Wave Division Multiplexing (DWDM) backbone. This new backbone facility, which is scheduled to be deployed in mid-1999, represents a 100 fold increase in @Home's backbone capacity and initially will enable the company to support up to five million broadband users. @Home will be able to cost-effectively scale its network capacity to support ubiquitous broadband services throughout North America over the next 10 years.

The agreement positions the company for continued residential and commercial subscriber growth and enables the development of advanced IP-based services. The added capacity also will enhance @Home's rich multimedia programming by empowering more content providers to connect directly to the @Home Network, enabling @Home users to take advantage of the most demanding multimedia Internet applications, such as streaming video and audio. In addition, @Home Network will be able to more efficiently interconnect and exchange traffic with other large carriers.

AT&T; was awarded the contract following a competitive review that included proposals from major next-generation network providers. AT&T; will initially provide @Home Network with 2 OC-48 (2.5 Gbps each) channels over each route of a 15,000 mile DWDM optical network. The facilities-based agreement provides for significant expansion of capacity, and additional routes, that can take advantage of the rapid evolution of DWDM technology. The agreement includes co-location space in AT&T; points-of-presence (POPs) and major carrier hotel facilities that will be used to interconnect @Home's backbone network to other major backbones.

"In preparation for continued growth and new advanced services, we are moving ahead with the next phase of the @Home backbone," said Milo Medin, chief technology officer and founder of @Home Network. "By connecting IP routers and switches directly to the DWDM optical infrastructure, we can achieve superior performance with much lower costs than traditional architectures using SONET add-drop multiplexors and ATM switches. And, we are deploying this architecture over the entire backbone system, not just a few links, thanks to the pervasive nature of AT&T;'s advanced fiber-optic network."

Through the use of Dense Wave Division Multiplexing, AT&T; will turn each one of its fiber strands into multiple virtual fibers. "AT&T; is committed to maintaining state-of-the-art optical equipment on the country's largest fiber-optic network," said Barbara Peda, president of wholesale services for AT&T.; "We are committed to being the leading provider of reliable high-speed services to @Home, and to other ISPs that need the type of network capacity that such an advanced network can provide. We believe this is crucial as the Internet evolves to the next phase of services."

AT&T; Corp. is the world's premier voice and data communications company, serving more than 80 million customers, including consumers, businesses and government. With annual revenues of nearly $52 billion and 110,000 employees, AT&T; provides services to virtually every country and territory around the world.

AT&T; runs the world's largest, most sophisticated communications network and the largest digital wireless network in North America. The company is a leading supplier of data and Internet services for businesses and the nation's largest direct Internet service provider to consumers. AT&T; provides outsourcing, consulting and networking-integration services to large businesses. The company offers outbound local calling to businesses in 49 states and, as a result of its July 1998 merger with Teleport Communications Group, plans to integrate complete local service into its business offers throughout 66 U.S. markets by early 1999.

AT&T; businesses are backed by the research and development capabilities of AT&T; Labs, which is working to create the information services and communications network of tomorrow.

@Home Network
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" attributes 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 Bresnan Communications Company, Cablevision Systems Corp., CasTel, Century Communications, Cogeco Cable Inc., Comcast Corporation, Cox Communications, Garden State Cable, Insight Communications, InterMedia Partners, Jones Intercable, Lenfest Communications, Marcus Cable, Midcontinent Cable Co., Palet Kabelcom, Rogers Cablesystems Limited, Shaw Communications, and Tele-Communications Inc.

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: the schedule for deploying the new backbone; the capacity supported by the new backbone; and the potential of the new backbone to enable advanced IP-based services, enhance @Home's multimedia programming and achieve superior performance with significantly lower costs. Actual results may differ materially due to a number of factors, including: numerous technological, operational and financial challenges associated with deploying the new Internet backbone and transitioning from @Home's existing backbone; @Home's and AT&T;'s ability to expand and scale the new Internet backbone over time; and the continued advancement of DWDM related technologies. The matters discussed in this press release also involve risks and uncertainties described from time to time in @Home's filings with the Securities and Exchange Commission. In particular, see the risk factors described in @Home's Form S-3 Registration Statement filed on August 12, 1998 and in its Form 10-Q for the quarter ended September 30, 1998. @Home assumes no obligation to update the forward-looking information contained in this press release.