SBC Investor UpdateCIBC World MarketsCommunications & Technology Food Chain ConferenceJ U N E 8, 2 0 0 4

Randall StephensonChief Operating OfficerSBC Communications Inc.

Cautionary Language Concerning Forward-Looking Statements

Information set forth in this presentation contains financial estimates and other forward-looking statements that are subject to risks and uncertainties, and actual results might differ materially. A discussion of factors that may affect future results is contained in SBC’s filings with the Securitiesand Exchange Commission. SBC disclaims any obligation to update and revise statements contained in this presentation based on new information or otherwise.

This presentation may contain certain non-GAAP financial measures. Reconciliations between the non-GAAP financial measures and the GAAP financial measures are available on the company’s Web site at www.sbc.com/investor_relations.

Significant Areas Of Opportunity

1Bundling

2Wireless

3Large Business

4 Cost Structure

Key Focus Areas

50% consumer key product bundle penetration

Bundles

On track to close AT&T Wireless acquisition this yearWireless

Large BusinessMarket

Nationwide IP network in place, expanded global sales unit, winning contracts

Expect new labor agreement and retiree plan changes to yield savings approaching $2 billion over next five years

Cost Structure

Bundlingopportunity

and execution

• 2.6 millionLD lines added in 1Q04

• 9.4 millionLD lines added over past four quarters

BundlingStrong Long Distance Growth

9.8

3Q031Q03

In-ServiceInterLATA PICs

(in millions)

YOY Growth Total LD Revenue

7.6

2Q03

11.5

4Q03

(2.2)%

4.1%

12.5%

14.427.6%

1Q04 3Q031Q03 2Q03 4Q03 1Q04

29.6%17.0

BundlingRobust DSL Growth

DSL Net Adds(in thousands)

4Q01 1Q03 1Q04

1.5 million DSL lines added over

past four quarters146

446

183

213226

245270

304

365377

• 9th consecutive quarterof accelerated net adds

• Driven by continuous innovation– Launched 1.5 – 3.0

Mbps speed tier service– Strengthened retail and

online distribution; 20% of consumer sales from alternate channels

1Q02 2Q02 3Q02 4Q02 2Q03 3Q03 4Q03

SBC

Verizon

Comcast

Cox CableTime Warner

BellSouth

304

270

245

SBC 4.0Verizon 2.7BellSouth 1.6

Comcast 5.7Time Warner 3.4Cox 2.1

365

377

Broadband Net Adds(in thousands)

DSL/Cable Modem Lines in Service

End of 1Q04,in Millions

450

350

250

150

4Q02 1Q03 2Q03 3Q03 4Q03 1Q04

446

BundlingStrong DSL Trends

BundlingSuccessful SBC | DISH Network Launch

Installed Base

America’s Top 120

52%

America’s Top 120

52%

America’s Top 180

18%

America’s Top 180

18%

DISH Latino 13%

DISH Latino 13%

• Launched service in March

• ARPU above $60

• Nearly 80% of the customers are bundling satellite with at least one other key service … LD, DSL or wireless

America’s Top 60 17%

America’s Top 60 17%

19%23%

31%

Key Product Bundlescustomers with bundles including one

or more key services – LD, DSL, wireless or satellite video

36%

2Q034Q02 1Q03 3Q03

44%

4Q03

The Future Of Bundling

50%

1Q04

• Average monthly revenue for customers in a bundle is more than doublethat of those without a bundle

• Next steps in bundling:

– Increased penetration

– Growth in video

– IP functionality, unified messaging

Wirelessopportunity

and execution

Cingular WirelessSolid Organic Subscriber Growth

• 554,000 net adds –nearly triple last year’s first quarter

• 2.5 million gross adds – third straight quarterwith gross adds at or above this level

1Q03 2Q03 1Q04

22.1

22.6

24.6

3Q03 4Q03

23.4

24.0

2.5 million net addsover past four quarters

Cellular/PCS Subscribers in Service(in millions)

1Q 2004 Results …

Cingular WirelessNetwork Advances

4Q032Q03

Cingular SubscribersWith GSM-Capable

Handsets

3Q03

35%

1Q04

45%

53% • 100% GSM/GPRSnetwork coverage targeted for July, six months ahead of schedule

• 96% of first-quarter postpaid gross adds were GSM

• EDGE networksubstantially complete this summer

27%

66% of Cingular’s minutes now on

GSM/GPRS network

Cingular Wireless

SacramentoSan Jose

SanFrancisco

Portland

Seattle

Los Angeles

San DiegoPhoenix

Las Vegas

Salt LakeCity Denver Kansas City

St. Louis

Minneapolis

Milwaukee

Chicago

CincinnatiLouisville

NashvilleMemphisOklahoma City

Dallas

San Antonio Houston New Orleans

BirminghamAtlanta

Jacksonville

OrlandoTampaWest Palm BeachMiami

CharlotteGreensboro

Norfolk

BaltimoreWashington, D.C.

New York

BostonBuffaloCleveland

Pittsburgh

Licensed Spectrum

(includes AT&T Wireless affiliates)

Cingular + AT&T Wireless

SacramentoSan Jose

Portland

Seattle

Los Angeles

San DiegoPhoenix

Las Vegas

Salt LakeCity Denver Kansas City

St. Louis

Milwaukee

Chicago

CincinnatiLouisville

NashvilleMemphisOklahoma City

Dallas

San Antonio Houston New Orleans

BirminghamAtlanta

Jacksonville

OrlandoTampa

Miami

Charlotte

BaltimoreNew York

BostonBuffaloCleveland

Pittsburgh

SanFrancisco

West Palm Beach

GreensboroNorfolk

Minneapolis

Washington, D.C.

Acquisition Summary

• Transaction expected to close this year

• $2.5 billion T-Mobile transaction contingent on closing Cingular acquisition of AT&T Wireless

• Significant synergies – expect annual operating expense and cap ex synergies between $2.0 billion and $2.7 billion by 2007

• Recent experience successfully integratinglarge-scale wireless operations

• Will be prepared to begin integration on closing

Large Business Market

opportunity and execution

Leader In Data Revenues

1Q04 Total Data Revenues

(dollars in billions)

SBCBellSouth Verizon

$2.6B

$1.9B

$1.1

• Largest data revenue stream among RBOCs

• 40% higher than closest peer

Large-Business Opportunity

10%$14B

SBC Market Share Today

$140BBusiness Telecom Market

(voice and data)SBC’s immediate large business target –companies with more than 50% of their locations in territory – represents $34 billion annual revenue opportunity

$140 billion includes voice, data, managed services, CPE, and wireless in small, medium and GEM business within the SBC footprint plus nationwide enterprise businesses. Source: Bain & Co.

Products SalesService

Capabilities

Broad range of flexible bandwidth solutions

Managed Services

Single Global

Accounts sales team

4,300 advanced data certifications

Single contracts,

service level agreements

Expanded Capabilities, Solid Traction

National ATM and Frame backbone, IP network

Network

Expect approximately $200 million in incrementalrevenues from contracts signed this year

opportunity and execution

Cost Structure

Margins

SBC Operating Income Margin

• Excluding lump-sum payments and strike-related costs, expect full-year operating income margins in 14.5% to 15.5% range, with quarter to quarter variation.

4Q03 1Q04

15.5%

13.4% Before Severance

12.0% Reported

SBC Consolidated results, excludes Cingular.

Labor Agreement

2.3% average annual increase, versus 4.1% under previous contract

Lower Rate of Base Wage Growth

Increased Flexibility in Force Management

Number of geographic areas for job offers reduced from 23 to 17

Greater Health-Care Cost Sharing

Increased co-payments for active employees and retirees

Overall savings expected to approach $2 billion over five-year period

Long Term Cost Initiatives

• Standardizing technology platforms

• Automating processes

• Consolidating centers to drive efficiencies and improved service

– Call centers

– Network centers

Clear goal:move to best in class in terms of operating efficiency and performance

SBC In Summary

• Solid Operational Momentum

• Financial Strength

• Focused on Significant Areas of Opportunity

1. Bundling

2. Cingular Wireless

3. Large Business Market

4. Cost Structure

SBC Investor UpdateCIBC World MarketsCommunications & Technology Food Chain ConferenceJ U N E 8, 2 0 0 4

Randall StephensonChief Operating OfficerSBC Communications Inc.