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2007 was a Banner Year for AT&T Global Business Services
Jan 28, 2008 (10:01 AM EST)
SAN ANTONIO, Jan. 28 /PRNewswire-FirstCall/ -- AT&T Inc. today announced that key fourth-quarter achievements enhanced AT&T's leadership position as a premier provider of solutions for enterprises worldwide. These achievements include the strategic acquisition of Web conferencing leader Interwise, an expanded agreement with IBM, global expansions of AT&T's network footprint, new service introductions and the completed integration of its mobility and wireline sales teams into a single sales force.
Last week, AT&T's Global Business Services (GBS) unit announced that recurring enterprise revenues were up 1.8 percent versus the fourth quarter of 2006 -- the strongest growth in this category in years.
2007: A Year in Review During the fourth quarter, AT&T: -- Acquired Interwise, a global provider of Internet Protocol (IP)-based voice, Web and video conferencing services and introduced AT&T Connect(SM) -- the first offer in a unified communications portfolio that will continue to expand this year. -- Struck an expanded agreement with IBM that named AT&T as the primary provider of networking services to IBM, with a provision that IBM and AT&T would jointly offer new or additional information technology and telecommunications services to commercial customers that currently hold contracts with both IBM and AT&T. -- Completed the integration of its wireless and wireline sales teams to continue the effort to deliver to business customers the enterprise mobility offerings introduced last April. Since then, GBS has won more than 2,000 new contracts and has generated a significant revenue stream from these offers. -- Was the only network services provider to win a role in all four key federal government contracts: Networx Universal, Networx Enterprise, Alliant and SATCOM-II. The Networx contracts allow AT&T to bid for task orders in the 10-year agreement with a potential value of $20 billion. -- Expanded its presence in countries such as India and Vietnam to further strengthen AT&T's position in emerging global markets. -- Opened two new Internet Data Centers in Piscataway, N.J., and Toronto, Canada. This brings the number of global data centers that AT&T operates to 38. AT&T also added more space to six other centers in the North America, Europe, and Asia because of growing customer demand for managed, hosted services. -- Enhanced its SONET and Ethernet portfolios, which positioned the company to meet the demand for high speed data and video services from Wholesale customers such as wireless carriers, Internet service providers (ISPs) and content providers. -- Expanded its IP/Multiprotocol Label Switching (MPLS) backbone, and deployed new-generation OC-768 technology in its Ultra-Long Haul Network, which is four times as fast as current OC-192 technology.
These milestones capped a year of strategic accomplishments and significant sales wins for AT&T in the business services market that returned the company to year-over-year revenue growth in recurring enterprise services for the third quarter of 2007, a year ahead of expectations.
Strategic sales wins announced in 2007 included: -- General Motors -- in a five-year network services agreement valued at nearly $1 billion. -- U.S. Department of the Treasury -- to build a next-generation enterprise network known as Treasury Network (TNet) in a deal that could earn AT&T up to $1 billion. -- Allianz of America -- for a four-year, $70 million contract for managed network services. -- Edward Jones -- for a five-year, global IP-virtual private network (VPN) services contract worth at least $54 million. -- Additional multiyear, multimillion -- dollar agreements with Sun Microsystems, US Airways, McAfee and others.
"We made some strategic moves in the fourth quarter of 2007 and delivered on multiple fronts to continue setting AT&T's Global Business Services on a solid growth trajectory as we move into 2008," said Ron Spears, group president, AT&T Global Business Services.
Many of the business unit's initiatives during the fourth quarter of 2007 capitalized on the ongoing shift in network traffic from voice to data -- more important, to IP-based data -- as customers continue to migrate from legacy packet networks to MPLS-based VPNs.
Indeed, the positive recurring revenue results for AT&T GBS were driven by strength in enterprise IP data revenues, including a 20.9 percent year-over- year increase in the fourth quarter, which includes areas such as VPNs, managed Internet services and hosting.
"As this mix in traffic keeps shifting toward data in the coming years, we expect our revenue growth to continue to expand because of improving supply and demand characteristics," Spears said.
"Our 40,000 employees and their expertise, combined with our global IP backbone network, industry-leading services and extensive, wholly owned wireless assets, have been key to our success in delivering solutions to our customers while differentiating us from other industry players."
2008: A Jump-Start to the New Year Building on its momentum, in 2008, AT&T GBS has already announced: -- An agreement with SAP America Inc. under which AT&T is named a Preferred SAP(R) Hosting Provider, serving as a primary SAP independent hosting services provider for business customers with headquarters in North America. -- A $20 million task order award from the U.S. Postal Service for software-engineering services.
AT&T GBS, which serves enterprise and wholesale customers worldwide -- including each of the companies in the Fortune 1000 -- provides a premier portfolio of voice, data, video and mobility networking solutions.
The company operates one of the world's most advanced and powerful global backbone networks, carrying more than 13.4 petabytes of data traffic on an average business day with up to 99.999 percent reliability. AT&T provides business services to 137 countries by using MPLS technology, which rides an IP backbone network reaching 97 percent of the world's economy.
AT&T continues to be one of the world's largest providers of IP-based communications services for businesses, with an extensive portfolio of VPN, Voice over IP (VoIP) and other offerings backed by outstanding customer care and security features.
For more information on AT&T services for business customers, go to http://www.business.att.com .
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Information set forth in this news release contains financial estimates and other forward-looking statements that are subject to risks and uncertainties, and actual results may differ materially. A discussion of factors that may affect future results is contained in AT&T's filings with the Securities and Exchange Commission. AT&T disclaims any obligation to update or revise statements contained in this news release based on new information or otherwise.
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