AT&T Announces Multi-Vendor Program to Increase Wireless Capacity and Efficiency

Strategic Insights -

AT&T has revealed a new multi-vendor program aimed at boosting the capacity and reliability of its wireless network in high-growth markets, while reducing operating costs. The company has signed letters of intent with Lucent Technologies, Nortel Networks, and will continue to use Ericsson, its largest wireless infrastructure provider. This strategic shift is expected to meet AT&T's equipment and network capacity needs over the next four years at a cost of $900 million less than previously projected. The move is driven by the strong demand for wireless services, particularly with the success of AT&T's Digital One Rate program.

Key Takeaways:

  • AT&T has launched a multi-vendor program with Lucent Technologies, Nortel Networks, and Ericsson to increase wireless network capacity and efficiency in high-growth markets.
  • The program is expected to meet AT&T's equipment and network capacity needs over the next four years at a cost of $900 million less than previously projected.
  • Ericsson will continue to supply equipment to approximately one third of AT&T's service areas.
  • Lucent, Ericsson, and Nortel will supply equipment and services to AT&T based on the digital TDMA (Time Division Multiple Access) IS-136 standard.
  • AT&T Wireless Services, Inc. operates one of the largest digital wireless networks in North America, providing wireless voice and data communication services to over 19 million customers in the Western Hemisphere.
  • The new equipment will enable AT&T Wireless to seamlessly evolve to new third-generation digital technology, providing high-speed data and global roaming capabilities.
  • The multi-vendor strategy will lower AT&T's wireless network operating costs and improve the company's supplier portfolio balance.
  • AT&T Wireless revenues grew 42.4 percent in the second quarter of 1999, driven by strong demand for wireless services.

Statistics:

  • 42.4%: AT&T Wireless revenue growth in the second quarter of 1999.
  • 4 years: The timeframe over which AT&T's multi-vendor program is expected to meet equipment and network capacity needs.
  • $900 million: The cost savings expected from the multi-vendor program over the next four years compared to previous projections.
  • 19 million: The number of customers served by AT&T's wireless network in the Western Hemisphere.
  • 1/3: The proportion of AT&T's service areas to be supplied with equipment by Ericsson under the multi-vendor program.

Sources:

  • AT&T Corp., press release.
  • Dan Hesse, President and CEO, AT&T Wireless Services, statement.
  • Frank Ianna, President, AT&T Network Services, statement.
  • "AT&T Wireless Services, Inc." brochure.