AT&T and BT's Concert Joint Venture: Global Communications Arm with $7 Billion in Revenues

Strategic Insights -

As the largest global communications joint venture, Concert is poised to revolutionize the way multinational businesses, carriers, and Internet service providers communicate worldwide. Launched in 2000, Concert combines the extensive networks and expertise of AT&T and BT to provide a broad portfolio of voice, data, and Internet services on an unprecedented scale. With a direct sales force serving 270 multinational customers and a global network of distributors serving an additional 29,000 customers worldwide, Concert has set its sights on capturing a significant share of the growing global communications market, worth over $100 billion.

Key Takeaways:

  • Concert has a direct sales force serving approximately 270 multinational customers (MNCs) and also serves an additional 29,000 customers worldwide through its network of global distributors.
  • The joint venture has a frame relay network that reaches every major city in the United States and the United Kingdom, and extends to an additional 170 cities in 47 countries.
  • Concert's global public network directly reaches 237 countries, more than any other existing network.
  • The company has built a new state-of-the-art high-speed Internet Protocol (IP) backbone network that spans 21 cities in 17 countries, supporting a wide range of industry-leading Internet access, Internet backbone, and IP Virtual Private Network (VPN) services.
  • Concert is expected to generate revenues of more than $7 billion in 2000, growing in excess of 15 percent per annum, with managed data and IP revenue as the key driver.
  • The joint venture plans to integrate its network with the IP backbone network acquired from IBM, with the combined network expected to support web hosting, application services, and other e-business solutions.
  • Concert has fixed assets of approximately $3 billion and plans to spend around $1.5 billion in 2000 on capital expenditures, aggressively deploying its facilities-based IP network.
  • The joint venture is expected to provide neutral to modest earnings accretion for AT&T and BT this year, with long-term growth prospects.
  • Concert has three profitable businesses: Global Markets, Global Accounts, and International Carrier Services, which together generate over 105 percent of the joint venture's total revenue.

Statistics:

  • Global communications market worth over $100 billion (text)
  • Concert's global public network reaches 237 countries (text)
  • Concert's frame relay network spans 170 cities in 47 countries (text)
  • Concert's IP backbone network spans 21 cities in 17 countries (text)
  • Concert's revenue projections: over $7 billion in 2000 (text)
  • Managed data and IP revenue growth: exceeding 15 percent per annum (text)
  • Capital expenditures: $1.5 billion in 2000 (text)
  • Fixed assets: approximately $3 billion (text)

Sources:

  • AT&T and BT press release announcing the financial closure of Concert
  • AT&T and BT joint statement on the launch of Concert
  • Concert's website (not referenced in the original text, but can be accessed online)