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AT&T is one of America's two dominant telecoms giants, but the clear #1 by total revenues. In its current form, AT&T re-combines several of the previously separate businesses which were formed from the break-up of the old Bell telephone system in the early 1980s. The key development was the acquisition in 2005 of "old" AT&T by regional operator SBC, and the subsequent purchase of the latter's wireless partner BellSouth. The merged group adopted the storied AT&T name, as well as an updated version of its old corporate logo. It was a welcome reinvention of a once-mighty brand which had up until that point suffered a dramatic decline in its fortunes. Mirroring the fixed line business, SBC and Bell South's Cingular wireless service in turn reinvented itself as a new version of the old AT&T Wireless company which it had swallowed a year earlier. In 2011, in an attempt to leapfrog main rival Verizon, AT&T announced plans to acquire smaller competitor T-Mobile USA for $39bn to create a mammoth business with 130m wireless customers. However, the Justice Department and FCC issued legal challenges to that deal on competition grounds, forcing the group to abandon its plan at the end of the year. AT&T did, however, manage to acquire much smaller Leap Wireless in 2013 for $1.2bn. In 2014, the group set about boosting its fledgling TV service with the acquisition of satellite broadcaster DirecTV for $49bn. That deal was finally completed in summer 2015. Just over a year later, AT&T was back on the acquisition trail, with agreement to acquire media giant Time Warner for $85bn. The US government launched an ill-conceived lawsuit to block the deal, but the judge found in the companies' favour and the merger went ahead as planned in summer 2018.


Who handles advertising? Click here for agency account assignments for AT&T from Adbrands.net. AT&T declared advertising expenditure of $5.1bn in 2018


See Telecoms Sector index for other companies.

Brands & Activities

AT&T is the biggest telecommunications company in the US by revenues, combining the local operations of what were previously SBC and Bell South, concentrated in 22 states, with "old" AT&T's market-leading long-distance service. Like a Walmart of the telecoms industry, all the numbers are big. Revenues for 2018 were almost $171bn, and AT&T is the #1 fixed line company, the #1 in broadband and in global connectivity. It was the #1 in retail wireless connections also until 2009, when it was overtaken by arch-rival Verizon. It had hoped to regain the top-spot once more in 2011 with the takeover of T-Mobile. That was not to be, but steady growth has allowed it to regain pole position by total customers, although it has a much higher proportion of less valuable prepaid users than Verizon. Instead, the company has turned its attention to content and distribution of that content.

Even before it acquired the old AT&T, SBC Communications had assembled arguably the widest range of communications services of any of the US operators. The company had established a number of powerful strategic alliances which extended the brand beyond regional connections into mobile, long-distance, broadband and even satellite television. Its target was to be able to offer seamless multi-platform phone services, combining fixed line and wireless connections through a mix of Wi-Fi, wireless and internet-based technologies.

But despite its size, SBC had low national awareness as a result of its origins as a regional service provider. The takeover of AT&T greatly enhanced its profile, especially among high-value business customers, a segment of the market where SBC had been comparatively weak. By contrast, the old AT&T had by then become increasingly reliant on its business services division. The company was also still a world leader in internet traffic, as well as the recognised expert in global networking communications. That position had led to the emergence of an extremely lucrative consultancy business, which in 2004, for example, was awarded a $1bn contract from the US government to build and manage a secure IP-based global network to link more than 1,000 government offices worldwide.

Fixed Line

AT&T currently offers local fixed line operations in 21 US states, mainly in the South and MidWest. At the time of the 2005 merger, old AT&T had already lost its local fixed line operations, although it remained the leading provider of long-distance communications, despite steady erosion of both revenues and market share by what were then smaller competitors, Verizon and SBC. SBC's fixed line operations were concentrated in 13 states in the American Southwest and Great Lakes region as well as in 30 other major urban or metropolitan markets. They were also originally offered under a variety of regional brands, the legacy of a series of acquisitions of other local providers (SBC Ameritech, SBC Pacific Bell etc), before gradually being rebranded under a unified SBC brand. BellSouth, previously based in Atlanta, served customers in nine states stretching from the Mississippi River to the Atlantic. The new AT&T combined those three sets of operations under a single umbrella.

The group is also a major force in broadband connectivity with around twice Verizon's coverage, and a wi-fi network that stretches across 79 countries worldwide. The old AT&T's cable and broadband division was sold to Comcast in 2002, so the current business was rebuilt from the operations of SBC. Although it was already the owner of the Prodigy ISP, SBC took its first real steps into full broadband in 2004, when it began offering a package of more sophisticated data services including VoIP internet telephony. By 2005, SBC Yahoo, a partnership with Yahoo, was the largest DSL provider in the US, and among the biggest dial-up ISPs. It later operated a high-speed internet service under the AT&T Yahoo banner, and Yahoo also hosted the telecoms group's web portal and other services. In 2016, AT&T pulled the plug on that relationship and transferred its web services contract to B2B provider Synacor.

AT&T began the rollout of add-on wi-fi service FreedomLink in 2004, as well as SBC Dish satellite television services, through a strategic alliance with Echostar. In 2006, the group unveiled a long-awaited broadcast service, teaming up with Echostar to offer broadband access to the latter's Dish Network service, and with online service Movielink to allow customers to download films onto their computer for home viewing. The combined TV and broadband service was marketed to residential customers under the AT&T Homezone banner. However, the number of satellite customers has slowly declined, down to 1.6m by the end of 2012, as a result of the growth in AT&T's own video service. This was launched in 2007 under the AT&T U-verse brand, competing directly with Verizon's equivalent FiOS service. It offers a range of data services as well as HD and DVR functions, but coverage is severely restricted geographically, not only by the limitations of AT&T's 21-state wireline footprint, but also the concentration of suitably powerful cable to more developed metropolitan markets.

In Spring 2014, AT&T turned its attention back to satellite broadcasting, agreeing terms for the acquisition of Dish's significantly larger rival DirecTV for $49bn. After more than a year of regulatory investigation the deal was approved and completed in July 2015. DirecTV was merged with the group's existing U-verse and internet operations. As a result, the group restructured its operating divisions, separating business and consumer services into different divisions, while DirecTV was carved out into a newly created Entertainment category. U-verse was gradually phased out during 2016. In Oct 2016, AT&T ramped up its entertainment portfolio with an offer to acquire Time Warner for a whopping $85.4bn.

Consumer fixed line connections are now accounted for under the Entertainment Group banner. Comparable residential voice connections continued to fall, slipping by 15% to just 8.5m by the end of 2018, while broadband subscriptions were flat at 14.4m. Total voice connections including business customers were 15.1m, while total broadband customers (business and consumer) were 15.7m. That's more than twice Verizon, but both figures were down slightly year-on-year. Total video connections from both U-Verse and DirecTV were down to 24.5m customers.

Combined revenues from traditional wireline services have been falling steadily for several years: increases in data revenues from internet and video traffic have failed to offset the sharp decline in the voice market.


AT&T complicates a like for like comparison against Verizon of wireless subscriber numbers by breaking up the figures under multiple headings, differentiating between "consumer mobility" and "business solutions". However, at the end of 2018, it declared 93.9m branded wireless subscribers in the US. Total numbers including MVNO, M2M and other customers in the US were 153.0m with another 18.3m in Mexico. AT&T has a much higher proportion of prepaid customers than Verizon, around 17m branded US customers or 18% of the total figure (compared to Verizon's 4%). AT&T also operates its own retail network, with around 2,300 outlets nationwide, selling mobile and other services.

The current business was created from the acquisition in 2004 of the old AT&T Wireless business by Cingular Wireless, then a regional operator. Cingular was at the time a joint venture between SBC and BellSouth, in which SBC held 60% of the equity to BellSouth's 40%, but in which both partners held equal voting rights. Following the subsequent takeover of BellSouth by SBC, the Cingular name and logo was gradually phased out during 2007 in favour of the parent AT&T brand. In June 2007, AT&T became Apple's exclusive partner for the launch of its new iPhone device, and it retained that contract for almost four years, giving it a significant lead over arch-rival Verizon among high-end users. (Verizon finally secured rights to iPhone from Feb 2011). Also in 2007, the group strengthened its national network with the $5.1bn purchase of Dobson Communications, a wireless service covering 17 rural states that previously operated under the Cellular One brand.

As a result, by the end of 2008, AT&T Mobility wa s the #1 wireless provider in the US, with the largest national footprint of any provider, covering around 98% of the US population. A few weeks later, in January 2009, Verizon completed its acquisition of smaller competitor Alltel, allowing it leapfrog AT&T into the #1 spot. Despite its own subsequent purchase of other regional providers, AT&T remains in second place. Verizon's deal to secure supplies of the iPhone from 2011 created a significant new threat. As a result, AT&T launched what it hoped would be a knockout blow, with a bid to acquire 4th-placed carrier T-Mobile USA for $39bn. That deal was blasted by customer groups, and was challenged by regulators. A legal review was ordered by the US Justice Department, followed by another by the FCC. In the face of these challenges, AT&T eventually abandoned the deal at the end of the year. According to a pre-agreed penalty clause, it was obliged to pay T-Mobile a $3bn compensation fee for the collapse of the takeover, and also transfer a large quantity of wireless spectrum. In an attempt to counter the intense competition from Verizon for smartphone subscribers following the loss of exclusivity over iPhone, AT&T agreed an exclusive partnership to launch the much-hyped Nokia Lumia 900 in the US in 2012. However that arrangement got off to a poor start because of technical problems and a generally weak level of interest in the device.

Foiled in its attempts to acquire T-Mobile, AT&T instead agreed to acquire the much smaller Leap Wireless in 2013 for $1.2bn. Leap was best-known for low-cost prepaid services, especially under the Cricket brand. Although it claimed nationwide coverage, its footprint is strongest in Eastern and Southeastern markets. The major benefit to AT&T was the additional wireless spectrum that Leap controls, covering 137m potential customers. AT&T continues to operate the Cricket Wireless brand, and has expanded it to additional markets, merging it with existing prepaid brand Aio.

AT&T has suffered for several years from accusations from customers that its network coverage is inconsistent and signal strength often weak. Over the 2009 holiday season, Verizon launched a brutal marketing campaign highlighting those apparent shortcomings. AT&T was forced to respond with a defensive campaign that arguably did little to deflect those accusations. Although its coverage has improved significantly since then, AT&T is still considerably weaker than its main rivals in the amount of wireless spectrum it controls. Prior to the Leap purchase, it had less spectrum overall than either of its two main rivals, and less per subscriber than 4th placed T-Mobile.

Under the new divisional structure, combined revenues from business solutions (both wireless and wireline) slipped back by 5% in 2018 at $36.76bn, with operating income of $8.09bn. Mobility delivered revenues of $71.34bn and operating income of $21.72bn. The entertainment group comprising DirecTV USA and residential fixed line services added revenues of $46.46bn with operating income of $4.71bn. WarnerMedia operates as a separate segment in its own right (see profile).


Virtually all of SBC and old AT&T's international investments had been divested by the time the two companies merged, although the combined group retained a 19% shareholding in Mexico's America Movil, a legacy from the old AT&T Latin America business. Signalling a renewed interest in the international arena, AT&T was involved in Spring 2007 in discussions to acquire an effective controlling stake in Telecom Italia, in partnership with America Movil. However those talks stalled in the face of opposition from the Italian government.

In order to secure approval for its bid for DirecTV, AT&T sold its shares in America Movil in 2014, and instead is positioning itself as a competitor to its former partner. In Nov 2014, AT&T agreed to acquire Mexico's third largest mobile company Iusacell for $2.5bn. That added around 8.6m subscribers, and the group bolted on an additional 3m users with an offer in Jan 2015 to buy Nextel Mexico, previously in bankruptcy protection, for around $1.9bn.

This revived international division of AT&T reported revenues of $7.65bn in 2018, with an operating loss of $710m.

Other operations

The takeover of BellSouth also gave SBC full control of the YellowPages.com online directory services business, which had also previously been a joint venture between the two companies. As a result of the combination of the publishing arms of old AT&T, SBC and BellSouth, the group became the dominant player in this sector, publishing more than 1,200 different directories in 22 states. However, combined revenues from this division, now described by the company as "advertising solutions", have been declining rapidly as the increase in digital advertising fails to offset a steep fall in the print sector. In 2012, AT&T agreed to sell a controlling stake in the business to private equity investor Cerberus Capital Management for $950m. At the same time, the business was rebranded as YP.com. AT&T retains a 47% investment stake in the business, which has revenues of around $2.5bn.


Combined revenues for 2013 edged up by just 1.0% to $128.75bn. Following a record profit of $19.9bn in 2010, net income slumped to $3.94bn as a result of impairments and a $4bn charge to cover the failed takeover of T-Mobile USA. There was only a partial recovery in 2012 to $7.3bn because of costs associated with damage from Hurricane Sandy. For 2013, net income rebounded to a more satisfactory $18.25bn, though still below 2010's performance.

Revenues for 2014 rose 3% to $132.45bn. However net income plunged by almost two-thirds to $6.22bn on the back of big increases in operating expenses associated with pension and healthcare benefits, as well as a $2bn charge for the abandonment of some older network infrastructures in favour of more up-to-date technology. The group also has large long-term debts in excess of $76bn, which cost it more than $3.6bn in interest during the year.

The addition of DirecTV gave a considerable boost to revenues in 2015, lifting the total figure to an extraordinary $146.80bn. Net income more than doubled to $13.35bn.

For 2016, group revenues rose by a further 12% to a new high of $163.79bn. However, higher broadcast costs from the entertainment group resulted in a 3% dip in net income to $12.98bn. Like rival Verizon, the group has accumulated considerable debt from acquisitions, not least the DirecTV deal. Net debt at the end of 2016 was $117.7bn. Just over 94% of revenues - $154bn - were generated in the US, with most of the rest from Latin America, principally Brazil and Mexico.

Revenues slipped 2% in 2017 to $160.55bn. Net income more than doubled to $29.45bn as a result of a mammoth $15bn tax gain in the final quarter. Excluding exceptional items, EBITDA was actually down 10% year-on-year.

For 2018, revenues rose by 6% to almost $170.8bn. Net income was $19.4bn, a solid increase on the comparable result from 2017, though that year's final reported profits incuded a large gain from tax cuts.


Randall Stephenson is chairman & CEO of AT&T. He succeeded Edward Whitacre, architect of the SBC takeover, in 2007. Other senior executives include John Stephens (senior EVP & CFO), John Stankey (CEO, AT&T Entertainment & Internet Services) and John Donovan (CEO, A&T Communications). Lori Lee, previously head of consumer fixed line, succeeded Cathy Coughlin as senior EVP & global marketing officer in 2015, and became global marketing officer & CEO, AT&T International in 2017.

See Account Assignments for AT&T marketing decisionmakers.


Alexander Graham Bell made the world's first telephone call in 1876, telling his assistant, "Mr Watson, come here. I want you." In fact, Bell was not the only inventor experimenting with this new technology, but he was faster than the competition, beating rival developer Elisha Gray to the patent office by a matter of hours. However he had used up all his investment funding in the process, so his backers tried to sell the patents to Western Union. The telegraph company turned them down, convinced that this new invention would never take off. As a result, Bell set up his own business to manufacture the invention and quickly found a huge market. Western Union belatedly bought up Elisha Gray's designs. Bell successfully sued, forcing Western Union to lease all its equipment from Bell. The American Bell Telephone Company held a complete monopoly on telephone communications in the US for 20 years, and a virtual monopoly for almost another century. Because of its market dominance, Bell's chief executive Theodore Newton Vail was also able in 1882 to take control of the country's leading electrical manufacturer Western Electric, which became the exclusive supplier of telephone systems and networks.

When American Bell's original patents expired in 1895, the market was suddenly flooded with rival operations, most of them providing local services. The Bell company initially struggled to fight off these competitors, but soon realised that the bigger profit lay in national communications. As a result, it set out to develop this market while retaining regional subsidiaries, which were grouped together as the Bell System. But the costs were astronomical and service was poor. In 1907, bankers JP Morgan acquired majority control of the company. Theodore Vail had left the company several years earlier, but was reinstated by JP Morgan as CEO. He changed the name of the business to The American Telephone & Telegraph Company, after the subsidiary unit which had managed the development of the long-distance network. Vail went on to buy former rival Western Union two years later, reinforcing AT&T's complete dominance of the US market.

Building on the international demand for distance communications the new AT&T was quick to establish a foothold in other countries. AT&T's Western Electric subsidiary also set up international offices to sell these to local operators, and quickly became the world's biggest manufacturer of telephone systems. By the start of World War I in 1914, International Western Electric was operating as far afield as Australia, Argentina, Japan and Russia. The following year, AT&T engineers transmitted the first transatlantic telephone call. Back home, however, the company was facing increasing pressure from regulators keen to dismantle the monopolies enjoyed by the likes of AT&T and American Tobacco. Bowing to pressure, AT&T sold off Western Union in 1913 and agreed not to acquire any other regional US companies in return for sole control of long-distance calls. But the group continued to grow rapidly, and the pressure from antitrust regulators remained intense. In another attempt to appease them, Western Electric's international operations were spun off in 1925 to form International Telephone & Telegraph (ITT).

The company's sheer size continued to bring it into conflict with antitrust regulators, and there were a series of bruising encounters with the US government in the 1940s and 1950s. After several years of argument, AT&T was forced in 1956 to restrict Western Electric to the production of telephones rather than the huge range of other household appliances into which it had diversified. In 1968, this monopoly too was taken away, and the company was forced to open its call network to rivals the following year. But this didn't stop the company's domination of US telecommunications.

In 1974, a new lawsuit from fledgling rival MCI and the federal government finally led to the dismantling of the increasingly vast business. After ten years of legal argument, the $150bn of assets owned by "Ma Bell" were split up between seven regional companies, the so-called Baby Bells. Two of these were Southwestern Bell, later SBC, and Bell South. AT&T was left with long-distance communications and Western Electric phone systems, as well as the seeds of a computer development business. Its research division, Bell Laboratories, was already a pioneer in this new technology having invented the Unix programming language in 1969. In a bid to expand its market position, the newly slimmed-down AT&T jumped into the computer market, acquiring computer manufacturer NCR in 1991 for $7.5bn. That strategy proved a failure, but the purchase of pioneering cellphone company McCaw Cellular in 1994 was to be more fruitful. Renamed AT&T Wireless, it established itself as the country's leading cellular service.

Following deregulation of the telecoms market in 1996, AT&T's core telecoms business came under intense pressure from a new army of competitors. The group had diversified too widely to focus on this new challenge, so attempted to slim down, selling NCR, and spinning out its technology and development divisions as Lucent Technologies. But by 1998 AT&T's share of the consumer market had fallen sharply, from 80% in 1992 to 60%, with further competition promised from cable and internet companies.

The task of newly appointed CEO Michael Armstrong was to remove AT&T's dependence on the regional Baby Bells who connected to its national backbone, and instead make a direct connection with consumer and business users. He made a series of deals designed to boost the company's strength in the boom areas of cable, international communications and the internet. The first deal was the acquisition of US cable giant Tele-Communications Inc (TCI), merging the two companies' cable and internet businesses. The result was the creation of several new divisions: cable operator AT&T Broadband & Internet Services, cable broadcaster Liberty Media Group, and also Excite@Home, a combination of high speed internet company At Home with leading web portal Excite. Soon afterwards, the group replaced MCI as the partner of UK operator BT to create Concert, a global business communications network.

In 1999, the group completed a string of huge deals. It acquired IBM's global IT network for $5bn; trumped rival Comcast to acquire cable company MediaOne for $58bn, in the process overtaking Time Warner as the biggest US cable operator; and also bolstered its wireless division with a series of purchases including Vanguard Cellular and American Cellular. The group also agreed to acquire local phone companies in Brazil and Chile, and combined them as AT&T Latin America. As part of its international partnership with BT, AT&T acquired small stakes in Japan Telecom and Canadian mobile operator Rogers Cantel.

However, Armstrong's rapacious deal-making didn't stop the erosion of AT&T's share in its core long-distance telephone business. A vicious and damaging price war erupted in 2000, eating away at AT&T's revenues faster than had been expected. More seriously, the numerous acquisitions had created a mountain of debt which peaked at around $64bn. During 2000, the financial markets turned against the company, pushing down its share price relentlessly. In order to unlock the value of its constituent parts, AT&T issued an IPO of AT&T Wireless in what was then the biggest float in US history, valued at $11bn. Despite the success of that sell-off, the group was forced to concede that fierce competition in the long-distance sector would affect full-year revenues and profits. As a result Armstrong announced plans to spin off the wireless division altogether, and break up the remaining business into three separate companies, each of which could also be separately floated.

In 2001 the group sold all but a small stake in AT&T Wireless, offloaded its shares in Japan Telecom (to Vodafone) for about $1.35bn, and split off Liberty Media as an independent company. Damaged by the collapse in the internet economy, Excite@Home filed for bankruptcy protection and was later dissolved, but the group pushed forward with its plans to float off its broadband division in a similar exercise to AT&T Wireless. A spanner was thrown into the works when cable rival Comcast made a $54bn all-stock offer for the business prior to its official spin-off. With telecoms stock prices plummeting, it soon became apparent that a trade sale might be the best route to follow, and AT&T solicited bids from the other players in the market. In the end, the Comcast offer was the best on the table. The deal was completed at the end of 2002.

It was also increasingly obvious that something needed to be down about the Concert joint venture with BT. More or less ignored by its joint owners while they focused on more pressing domestic issues, Concert had begun to rack up dramatic losses, peaking at almost $800m for 2001. Talks to strengthen the business by adding in additional services stalled, and the two partners eventually wound the business down, taking back the parts of their international business networks they had originally committed to the venture. (The cost to AT&T was a write off of around $500m). In early 2003 AT&T announced further job cuts, equivalent to around 5% of worldwide staffing. Its extensive but loss-making operations in Latin America filed for bankruptcy protection in 2003 and the assets were sold in 2004 to Telmex.

Back home, AT&T's revenues and market share had been steadily eroded by what were once smaller competitors, such as Verizon and SBC, each of whom had outgrown their local markets. [See here for SBC history]. The group attempted to respond by moving aggressively into local telecoms, introducing services in eight US states in 2001 and 2002. But by the end of 2004, AT&T had slipped into third place by total revenues. As a result the group began to look increasingly like an acquisition target. Discussions were held with several companies, and a deal was almost agreed with BellSouth in 2003 before the smaller company pulled out. In 2004, the group said it would stop offering long-distance and local phone services to new residential customers. In early 2005 it was reported that merger talks had opened with SBC, and soon afterwards the two companies agreed a deal whereby AT&T would be acquired for around $16bn in SBC stock. The merger was completed in November 2005, at which point SBC adopted the AT&T corporate name. In March 2006, the group announced plans to get bigger still, acquiring its partner in Cingular, Bell South, for around $67bn. That deal completed at the end of 2006. The explosive growth of SBC up to that point had been overseen by Ed Whitacre, who became the merged group's new CEO. He eventually stepped down in June 2007, and spent the next few years rebuilding another ailing corporate giant, General Motors.

Last full revision 18th August 2017

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