It’s no secret that wireless is the growth engine of telecom and is a foundation of the business both today and in the future. AT&T CEO Randall Stephenson makes no bones about where his thought process is relative to wireless. “We have 77 million wireless customers and 30 million consumer phone lines,” Stephenson told the Wall Street Journal in a recent interview. “Which customer base would you rather work from? We tend to come at this backwards.” With statements like that, you wonder if an AT&T wireline spin off is on the horizon?
In the WSJ interview, Stephenson gives some insight into his plans to make wireless king in the traditionally wireline focused company. One could argue that shift has already happened, but Stephenson intends to solidify wireless as AT&T’s core mission. Strategies will include trying to extend exclusivity on Apple’s iPhone and replacing wireline service with wireless as the voice component of the triple play bundle. This philosophy was set in motion last year when Stephenson appointed Ralph de la Vega to oversee all consumer markets including wireline and wireless. de la Vega’s pedigree is wireless – he was president of AT&T Mobility before taking on this expanded role. It’s no mistake that a wireless executive is now in charge of AT&T’s wireline business.
By making wireless the company’s core focus, AT&T is leveraging their natural advantage over the growing competitive threat from cable. AT&T has no distinct advantage over cable when it comes to voice and video. Some would argue they’re at a disadvantage thanks to technologies like DOCSIS 3.0. But in wireless, AT&T has a supreme lead – one that cable will be chasing for many years to come (maybe forever), even with their favorable spin on WiMAX. Comcast’s CEO Brian Roberts fully admits cable’s wireless ‘conundrum.’ At the recent Cable Show, Roberts commented that with wireless, “AT&T and Verizon are not the elephants – they are the super elephants. They have all the market share.”