NYTimes. AT&T and British Telecom Plan Global Wireless Link
September 17, 1999
Aim Is to Offer `Anytime, Anywhere' Service
By SETH SCHIESEL
he AT&T Corporation and British Telecommunications P.L.C.
said Thursday that they would expand their global
communications alliance by linking their wireless telephone operations
around the world.
AT&T, the biggest communications company in the United States, and
British Telecom, the biggest phone company in Britain, are already trying
to create a $10 billion joint venture to serve the international
communications needs of multinational corporations.
While the new wireless alliance would not technically be part of that
venture, its formation underscores the growing importance of wireless as
part of the comprehensive communications package that carriers around
the globe are trying to build.
"The mobile market has been a country-by-country market," Sohail
Qadri, British Telecom's director for wireless services, said. "We have
been trying to grow our mobile capability around the world. What's
happening now is that there are some global drivers beginning to emerge
in a significant way that make this sort of deal make sense."
New wireless alliances appear to make sense to others as well. The Bell
Atlantic Corporation, one of the regional Bell telephone giants, is trying to
negotiate a deal to combine its United States wireless operations with
those of Vodafone Airtouch P.L.C. of Britain, the world's biggest
wireless carrier.
The two deals, however, seem quite different. While Vodafone and Bell
Atlantic appear to be negotiating to create a new joint-venture company,
AT&T and British Telecom's pact appears significantly less extensive,
representing a cooperation agreement between the two companies rather
than the creation of a new one. No money will change hands and Qadri
said that AT&T and British Telecom would not unify their core wireless
service brands.
Still, the new AT&T-British Telecom alliance, to be called Advance,
would be a wireless behemoth, with 41 million customers in 17 countries.
Together, the two companies' wireless operations generate about $12
billion in annual revenue.
But for all the money they take in, AT&T's and British Telecom's
wireless operations generally use different technologies, as do many
wireless carriers from different parts of the world. That diversity of
wireless technology has generally prevented most United States wireless
customers from "roaming" to and using their phones in other countries. As
part of their new pact, AT&T and British Telecom will attempt to
develop trans-Atlantic roaming.
"If you travel, you expect your B.T. or AT&T digital phone to work
anywhere and everywhere with all of the advanced features you have,
just as if you were at home," John D. Zeglis, AT&T's president, said in a
statement. "This is not possible in many cases today for a whole host of
reasons, including incompatible technology and government regulation.
By pairing two of the leading telecommunications companies in the world,
AT&T and B.T., we think we can make some things happen that will
eventually give customers those 'anytime, anywhere' capabilities from
their mobile phones."
Qadri said that next year the two companies intended to introduce
trans-Atlantic roaming in a way that would let users keep their phone
numbers even when traveling to different countries. Those users,
however, would have to use two phones because of the different
technologies used in different countries.
By 2001, though, the companies intend to offer international roaming
using a single handset, Qadri said, using technology AT&T and British
Telecom are developing with Motorola Inc. and Siemens A.G. of
Germany. Such capabilities are already offered by many smaller United
States wireless operators that employ the wireless technology used in
Europe.
Such services would be useful for tourists, but the main objective of the
new pact, as in most areas of international telecommunications, is the
multinational corporate client. AT&T and British Telecom want to offer
big companies with wireless users in many countries unified billing and
perhaps cross-border discounts, and it could be cheaper for the two
carriers to develop those services together rather than separately.
"There is a need to develop products and services and share risks across
more than one market," Qadri said. "The cost of developing billing
systems, customer service systems and so on is becoming more and
more expensive and you need to be able to share those costs across a
bigger customer base."
John Bensche, a wireless analyst at Lehman Brothers, said: "I think what
they're trying to do here is to put together a compelling selling proposition
when they go selling to multinational companies. They want to offer a
wireless check-off box in addition to their other services."
Copyright 1999 The New York Times Company |
