AT&T update: High profile personnel shifts bolster carrier's service stature

By David Rohde
Network World Fusion, 12/07/99

As part of a wide-ranging reorganization, AT&T Chairman C. Michael Armstrong on yesterday tapped two executives to head up a newly converged business unit handling all the company's enterprise networking services.

Rick Roscitt, currently president of AT&T Solutions - the company's hugely successful outsourcing and managed-network unit - will become president of AT&T Business Services heading the company's entire voice and data enterprise networking effort.

Kathleen Earley, current president of AT&T Internet Services, will get the frame relay, ATM and private line portfolio as the new president of AT&T Data and Internet Services. Earley will report to Roscitt, who in turn will report to Chairman and CEO C. Michael Armstrong.

The appointments of Roscitt and Earley - two of AT&T's most visible executives in recent months - are an attempt to solve a double-edged problem at AT&T.

One problem is that AT&T's business Internet offerings, such as T-1 and higher Internet access and virtual private network services, have been removed from the carrier's more traditional fast-packet and private line business, creating an unclear migration path for customers.

The other is a leadership gap that resulted when the former chief of AT&T Business Services, high-profile telecom veteran Bob Annunziata, resigned abruptly last spring. Annunziata, who previously ran Teleport Communications Group - the competitive local exchange carrier for businesses that AT&T acquired in 1998 - is currently CEO of high-flying start-up Global Crossing Ltd., now in the process of taking over No. 5 long-distance carrier Frontier.

Annunziata had been temporarily replaced by AT&T veteran Michael Keith. But Keith had retained a low profile and was shifted into a new position. Keith is now head of a new fixed-wireless local loop venture within AT&T's sprawling wireless unit, now slated to be a separate tracking stock beginning next spring.

At an investment analyst conference in New York, Roscitt and Earley promised new integration between traditional and Internet-based offerings. For example, they touted AT&T's recently introduced IP-Enabled Frame Relay - a service that uses IP addressing rather than frame relay routing tables and multiple permanent virtual circuits to achieve any-to-any connectivity in a corporate network. "And we're going to catapult ourselves into the Web hosting business," Earley says.

But Earley ruled out a widespread move by AT&T into the application service provider (ASP) business. Instead, she says AT&T's Web hosting business - just getting under way with a two-year schedule to construct 26 hosting centers - could have ASPs as well as enterprises as customers.