Randall Stephenson is far from a household name, but that will begin to change June 3 when he takes over as chairman and CEO at AT&T.

Edward Whitacre, current CEO, today announced at the company’s annual shareholder meeting his plan to retire.

Whitacre recently turned 65, so news of his retirement isn’t entirely unexpected. But with a contract in place until 2008, Whitacre surprised industry watchers with the news he will relinquish the CEO title within two months.

Not only did he announce his retirement, but also that Stephenson would be his successor. “Earlier this morning the board elected Randall Stephenson, our chief operating officer, to replace me as chairman and CEO effective upon my retirement,” Whitacre said. “Randall is a great executive with a wide range of experience. He’s a proven leader with vision and character. Randall enjoys the respect of our board and our employees. He will be a wonderful leader for AT&T.”

Industry watchers say it’s no surprise, meanwhile, that Stephenson is Whitacre’s replacement. “Stephenson has been 'heir apparent' for several years,” says Mark Winther, group vice president and general manager of worldwide telecommunications at research firm IDC.

One analyst agrees. “After SBC acquired AT&T and [its CEO David] Dorman left, and after the new AT&T acquired BellSouth and [Duane Ackerman, then CEO] left, I think it was a forgone conclusion for everyone that the decision was made and Stephenson was going to take over,” says Jeff Kagan, a telecom industry analyst.

Stephenson, who is AT&T’s current COO, has a long history at SBC and AT&T and works very closely with Whitacre.

He joined Southwestern Bell in 1982, rose up through the ranks, and in 1996 was promoted to controller for SBC.

“He goes back a long while with Whitacre. His background is accounting and corporate finance,” Winther says. “His strength is in finance, less so in strategy or technology. However, I think he has been a key part of the AT&T and former-SBC strategy established 10-plus years ago that the way to succeed was scale and network asset ownership.”

Before becoming COO at SBC in 2004, a role and title he held through the AT&T acquisition in 2005, Stephenson was senior executive vice president and CFO at SBC. According to AT&T, during his time as CFO at SBC, he was instrumental in reducing the company’s debt from $30 billion to near zero by 2004.