But while AT&T is feeling confident that it has adequately protected its network, concern is growing that the networks of some of the other hundreds of phone companies around the world are falling behind in solving the Y2K problem.

AT&T began spending the $650 million in 1996, putting it ahead of schedule with programs, testing and backup planning. AT&T officials express "tempered optimism" that the company's network can handle just about any glitches, including widespread power outages, that could result when the calendar changes to "00" on various computer systems. The pace of the company's year-2000 spending, in fact, is even slowing a bit this year, said A John Pasqua, an AT&T VP in charge of the company's year-2000 program.

But because of the complex nature of telecommunications today, that may not be enough to prevent all problems thatcallers may have. That's because consumers don't notice that almost every call they make is handed off several times between the long distance and local networks of potentially hundreds of companies. International calls are subject to even more handoffs that often involve government-run communications companies. A problem with just one of the handoffs could mean calls that can't be completed. C Michael Armstrong, AT&T's chairman, heads a Federal Communications Commission committee that is looking into the preparedness of phone companies around the world to handle year-2000 associated problems. That committee, called the Network Reliability and Interoperability Council, is meeting Wednesday to issue an updated assessment that could raise some concern, particularly on the international front, said AT&T officials.

"A lot of countries haven't even started yet," said Pasqua. At the last update four months ago, Mr. Armstrong's committee had information on only 85 countries. In this week's latest update, thatfigure is expanded to about 190, said Pasqua. But there is increasing evidence that the telephone companies of many countries are just beginning preparations.

Problems outside the US wouldn't affect AT&T's network directly because the company has elaborate safeguards. But they could make it difficult to route calls into, or through, certain places. While AT&T and most big phone companies in the US have been working on year-2000 preparations for some time, Pasqua said some smaller, more rural telephone providers haven't made substantial investments. "The data show that they are falling behind," he said. AT&T is offering help to phone companies or any businesses that ask about year-2000 preparedness through its Web site. "We are trying not to hide but be very visible and vocal about where we are," said Pasqua.