Powertel's Response

Powertel Responds to Wireless Security Issue

March 20, 1997

Powertel, a Personal Communications Service (PCS) provider and wholly owned subsidiary of InterCel, Inc., (NASDAQ: ICEL), today responded to newly raised concerns over wireless communication security issues.

This comes in response to an announcement made today by a team of commercial and academic cryptographers that claims it has "discovered a flaw in the privacy protection used in today’s most advanced digital cellular phones." The flaw relates to the Cellular Message Encryption Algorithm, which secures signals between a handset and a base station.

"Powertel wishes to assure its customers that the concerns raised over the security of digital wireless transmissions are not applicable to our network," said Edward C. Horner, chief operating officer of Powertel. "Powertel’s network, built upon the Global System for Mobile Communications (GSM) technology platform, has not been compromised. Thanks to GSM’s design process and proven functionality, we are able to offer a level of security in which our customers can place the highest degree of confidence."

Powertel’s GSM-based network relies on both encryption and authentication to enhance security. The encryption algorithm utilized by GSM networks worldwide differs from that of the digital wireless networks in question. The codes that were broken are not now, nor have they ever been, used by Powertel or other North American GSM-based providers. Authentication remains secure, and continues to be the industry’s most effective tool in fighting security breaches.

Powertel is licensed (or has licenses pending) to provide PCS in 12 states to a population of 22 million people. Major cities include Atlanta, Augusta, Birmingham, Chattanooga, Jackson, Jacksonville, Knoxville, Louisville, Memphis and Nashville. The company utilizes the Global System for Mobile Communications (GSM), the leading technology for digital communications deployed in 108 countries with more than 28 million subscribers. Powertel offers compact handsets featuring portable phone, voice mail and paging services throughout its coverage area. For more information on the company and its services, visit the Powertel section of http://www.ICEL.com on the World Wide Web.

NOTE TO EDITORS: This press release contains statements which constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1993, as amended, and the Securities Exchange Act of 1934, as amended. These statements appear in a number of places in this press release and include all statements regarding the intent, belief or expectations of the Company and/or its management. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Actual results may differ materially from those anticipated in the forward-looking statements as a result of the factors discussed in detail in the Company’s filings with the Securities and Exchange Commission, including the "Risk Factors" section of the Company’s Registration Statement on Form S-1 (File Number 333-2748).


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Carol Cookerly, 404/816-2037


Russ Williams, 404/816-2037

up to Flaw in Cell Phone Encryption Identified

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