Tough-Talking Somers Vows to Pack Punch

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Denver -- Daniel Somers left no doubt that there was a new
sheriff in town last week, after arriving here to take charge of AT&T Broadband &
Internet Services.

AT&T Corp.'s chief financial officer, he replaced
deposed AT&T Broadband CEO Leo J. Hindery Jr. at the helm of what will be the nation's
largest MSO, and he vowed to "leverage the hell" out of the unit's ties to the
telecommunications giant.

During an hour-long, but close-to-the-vest, session with
reporters, he said his job as CFO puts him in a unique position to "know where the
sweet spots are" as far as tapping corporate resources needed to deploy broadband
services.

"And I'm going to demand a lot from my parent,"
he added.

Priorities, he said, will be launching AT&T's eight
planned telephony-pilot programs, getting upgrades completed on time and packing the
company's broadband pipe with "the best damn services" in order to "get our
revenues per subscriber up."

Somers' arrival drew immediate praise from another Denver
visitor.

Amos Hostetter, the nonexecutive chairman of AT&T
Broadband, who is also an AT&T director and an adviser on broadband strategy, called
Somers AT&T chairman C. Michael Armstrong's "most trusted lieutenant."

"The fact that [Somers] is out here is incredibly
significant for the cable industry and AT&T Broadband," Hostetter said.

Somers wasted no time indicating that his will be a tightly
run ship that will "let events come before lips speak."

He was essentially spiking media reports based on press
leaks during the final weeks of Hindery's tenure that had AT&T Broadband preparing to
order up to another $1 billion worth of digital set-top boxes and cable modems from
General Instrument Corp. and Motorola Inc.

Analysts dismissed the purported orders as AT&T
Broadband flag-waving in support of the pending GI-Motorola merger, questioning why the
MSO would add to its already substantial box orders from GI at a time when it was
stressing the need for a multiple-vendor, retail-oriented environment.

"Have we officially announced anything?" Somers
responded when asked about the purported deal. "Then we don't have anything."

Somers was equally closemouthed on other topics, refusing
to address last week's Multichannel News report that AT&T angered other cable
operators by unilaterally proposing a plan to the Federal Communications Commission to
provide a way for Internet-service providers to gain access to cable's broadband pipe.

He also characterized as "speculation" reports
that AT&T is negotiating an ISP-access deal -- reportedly with MindSpring Enterprises
Inc. in Atlanta -- as a way of demonstrating that it intends to have an open platform once
its exclusive content deal with Excite@Home Corp. expires in 2002.

"Our efforts will be to create relationships with a
variety of [service] providers," he said. "A model was created that gave
exclusivity. That clock is ticking. Everybody has to look at what happens post-2002."

He did not, however, seem concerned over whether AT&T
Broadband would be able to handle the network issues that would arise from opening its
cable systems to multiple ISPs.

Calling the technical preparations "a work in
progress," Somers said capacity would not be a problem. AT&T's Internet backbone
will be up to OC-192 speeds next year, and interactivity and bandwidth-management issues
will likely be no different than "how you approach interactivity on a new
860-megahertz network."

He reiterated the importance of shifting the set-top and
cable-modem businesses to retailers -- a migration that can only happen if AT&T
Broadband helps to support the entry of other manufacturers.

So far, the MSO has only announced plans to deploy GI's
"DCT-5000" advanced interactive set-tops and to use Microsoft Corp.'s
"Windows CE" operating system, although it stressed that there would be a
multivendor operation for those areas.

"I don't think there's any question that we need a
broader set-top strategy," Somers said.

By the 2000 Christmas season, he said, big retail outlets
could be offering customers a choice of four to five different set-top brands, each with a
simple user interface and an installation-authentication procedure no more difficult than
that for direct-broadcast satellite users.

"We're going to have to work hard to have a solid
solution in retail," he added.

Predictably, Somers maneuvered around questions concerning
his operating style compared with that of his predecessor, characterizing himself as
"disciplined" and a "risk-taker" and Hindery as "superbly
extroverted" and "a great spokesman for the cable industry."

The following day, at a staff-only meeting at AT&T
Broadband headquarters, Somers -- who is looking for home here -- emphasized that there
are no plans to move the MSO's operations closer to AT&T's corporate headquarters in
Basking Ridge, N.J.

"That's a joke," he said during the press
briefing. "We have better human resources here, and operating costs are lower than in
New Jersey. Nobody is going back east. AT&T Broadband is right here."

However, some staffers were reportedly disappointed that he
failed to address questions about his "vision" for where the company is going.

And although he hedged when asked if he was interested in a
permanent assignment in Denver, some came away from the meeting convinced that Somers
wants the top job.

"Yeah, he definitely wants to be the guy," one
staffer said.

Added another AT&T Broadband executive, who asked not
to be identified: "I think he is a great guy who is both knowledgeable and committed
to the broadband business. I think he has the energy and business acumen to be a
tremendous leader."

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