• United States

AT&T addresses Wall Street

Feb 26, 20043 mins

AT&T reinforced its message of reducing costs while fighting to keep customers this week at the carrier’s first financial analyst meeting in three years.

AT&T chairman and CEO David Dorman opened the day by promoting the carrier’s successes in process remediation, reducing complexity and costs in its network by decommissioning 160 legacy systems and further head count reductions for 2004.

The carrier, like most in the industry, is still struggling to turn around revenue declines by improving internal operations. But last month when AT&T announced it’s fourth quarter earnings, it was clear that AT&T was also losing business customers.

Bill Hannigan, who took the reins as president in December, says the carrier is doing everything it can to keep its existing customers and bring in new businesses. The company’s three main goals include to “win every opportunity, have the most competitive cost structure and be easier to do business with,” he says.

Dorman said last month that AT&T “will not be beat on price” after the carrier lost customers because it did not offer business users competitive rates following a drop in market prices. But Hannigan tweaked the company’s stance on pricing yesterday.

“We garner a premium in the market…depending on the service,” he says.

While he reiterated Dorman’s comment that the carrier will be competitive, a premium means users will pay more for an AT&T service. Hannigan did not elaborate on which services carry a higher premium.

In addition to laying out the carrier’s plans to better compete, Hossein Eslambolchi, president of AT&T’s global networking technology services, discussed how AT&T’s network advances are leaving others in the dust.

“The AT&T network will never be identical to others in the industry. It is now and always will be better,” he says.

Eslambolchi says the AT&T network carries more traffic and is more reliable than all of its competitors. He used the SQL slammer worm attack of 2003 as an example of how AT&T’s network not only predicted the imminent attack, but prevented it from suffering the fate of competitor backbones – impacted performance.

Despite how well AT&T’s network runs, the carrier needs to offer business users services that are compelling and reasonably priced to keep them on that network. Cathy Martine, senior vice president of voice Internet services and consumer product management, launched the carrier’s new consumerVoIP service aimed at the same market that competitors Vonage and 8×8 target.

Martine hinted that while AT&T has been offering business VoIP services for over two years, enhancements for these customers are also planned.