Pat, this news is very interesting.As you recall, ATT and IBM Global Network Business got over 1 bil. contract from Bank One which is merging with First Chicago.They will use some NN atm equipment( may 1998, ATT-NN deal).Later MSFT made similar deal with ATT and recently 3COM.During cc regarding the first deal I have mentioned ATT said that they made similar deals with other US banks.Also it was mentioned that ATM will play key role in new networks!There is no question that ATT want to be No1 broadband data provider.
T&T Buys IBM's Data Networking Biz
NEW YORK (AP) -- AT&T Corp. (NYSE:T - news) is buying IBM's data networking
business for $5 billion cash, filling a gap in AT&T's ability to supply business customers
with high speed data services and Internet access.
International (NYSE:IBM - news) Business Machines Corp.'s Global Network Business, with $2.5 billion in revenue, has
one million Internet users as well as tens of thousand of business customers in the U.S. and abroad.
Under the deal anounced today, 5,000 IBM employees from the global network division will go to work for AT&T when
the deal closes. The deal is expected to be concluded by next summer.
In a related move, IBM agreed to manage AT&T's computers that support its long-distance services for business customers
for $4 billion over 10 years. As a result, more than 2,000 AT&T employees will go to work for IBM.
In addition, AT&T will manage the communications needed by IBM for its customers for $5 billion over five years.
Today's deal, which has been rumored for months, aids AT&T's goal to become a dominant provider of communications
that use Internet technology to transmit data. In addition to giving AT&T a strong presence in the United States, the deal
bolsters AT&T's joint venture with British (NYSE:BTY - news) Telecom, announced earlier this year, which aims to supply
communications services to business customers across different nations.
For IBM, the sale enables it to focus on its strengths in selling computers and computer services.
IBM's network grew from a phone system linking its outposts into one of the world's largest communications systems. It
transmits corporate data for about 30,000 customers in 50 countries.
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