News

AT&T Wants To Bundle in Wireless

10/02/2008 8:00 PM Eastern

AT&T, facing tough cable competition and economic uncertainty, has rejiggered its business units in an attempt to inject wireless services into its triple-play bundle of wireline voice, broadband and TV.

The telco last week disclosed that it is realigning into four divisions: consumer, enterprise, technology operations, and diversified businesses.

The consumer-markets unit will be headed by Ralph de la Vega, president and CEO of the AT&T Mobility wireless group — a clear sign that AT&T wants to push wireless into multiplay bundles.

In a statement, the company said the changes represent “the next natural step in our plan to bring together the best of what we deliver — mobility, broadband, voice, video, data, applications and services on our global IP network — combined with a quality customer experience. We expect these organizational changes will make us more effective and efficient in our sales and operations.”

AT&T spokesman Michael Coe said the company currently has no specific plans for layoffs related to the new organizational structure.

Analysts said AT&T is trying to emphasize its wireless offerings as a key advantage over cable operators.

“We believe [residential] trends are likely to weaken further in [the second half] as cable companies get more aggressive and the economy worsens,” UBS telecommunications analyst John Hodulik wrote in a research note. “We expect AT&T’s new structure to result in new efforts to bundle wireline voice/video/data services with wireless, fulfilling the company’s promise of the 'three screens’ approach.”

De la Vega, as head of the consumer division, will oversee strategy and execution for a group that encompasses wireless, traditional landline phone, Internet and TV services. Ron Spears, group president of AT&T Global Business Services, will head the enterprise-business unit. John Stankey, group president of telecom operations, will become head of AT&T’s technology operations. Ray Wilkins remains CEO of the diversified-businesses unit, which includes YellowPages.com.

The reorganization comes after AT&T announced in June that it was moving its corporate headquarters to Dallas from San Antonio, which affected about 700 of its estimated 6,000 employees in the Alamo City.