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Summary:

For last six months, I have been arguing that SBC got a real bargain in AT&T. Not only did AT&T bring to the table a fully modernized network, corporate telecom expertise, but also a company whose operations are on the mend. In the most recent quarter, […]

For last six months, I have been arguing that SBC got a real bargain in AT&T. Not only did AT&T bring to the table a fully modernized network, corporate telecom expertise, but also a company whose operations are on the mend. In the most recent quarter, AT&T posted profits, and painted a better future. But the biggest thing SBC got was the AT&T name. It is worth more than all the cash on the giant’s books. And it certainly is more memorable than SBC which is a regional brand that reminds you… (add your own pun!)

“The AT&T brand reflects what customers are looking for in a provider,” Whitacre says, “They want the latest technology and services, but they also want reliability, quality and trustworthiness. Only the AT&T brand offers this ideal combination of traits.” There is a lot of stuff in the press release about next generation IP services etc. Never mind. For me, the brand is something more emotional. It was AT&T’s service that connected me to my family back home in India when I was a new immigrant. It was an emotional connection I had with the name, and I am glad to see the name not getting lost in mists of time.

  1. What will happen to the two discontiguous IP and Telephone networks? Will they keep both and run as separate entities?

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  2. Also, don’t forget AT&T has some patents especially in the networking and voip arena from AT&T labs (the mother of all research labs)…that SBC is going to use to gain much moolah from. The scientists at AT&T labs produced a lot of the innovation around the internet too (which is a network and rides on telco infrastructure)

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  3. Does your admiration lead to a purchase recommendation? In the old days, one would want to buy AT&T about now in the economic cycle. The steady earnings would begin to look good at about the time the consumer lead recovery converted to a business expansion. SBC, VZ and BLS now look like value stocks, but then the land line business is pretty sick.

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  4. kenny for what i understand is that eventually everything of theirs is going to run on IP, except for that pesky last mile. i guess this remains to be seen, but i am hoping that T rises to new levels.

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  5. Jack,

    no stock recommendations ever. i am not a financial expert, and will never ever talk stocks. sorry but just feel religious about it.

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  6. OK, a friend caught me using my java2king alias (once too often), I am as promised..posting one with my “real” id..:)

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  7. Nuts to that. AT&T was broken up in 1984 as part of an anti-trust lawsuit. All that remains is for Verizon to buy Qwest and SBC to buy BellSouth, and to quote the Highlander “There can be only one.”

    I HATE AT&T. I don’t have a single good thing to say about any time I’ve had service from them. Their customer service was always the worst in the business, and combining that with SBC arrogance doesn’t bode well.

    Personally I’m going to have T-shirts printed up with a nice graphic of the Death Star, with the AT&T logo.

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  8. I have emotional ties to the old AT&T and the name too – my mom retired from them after 26 years, in the day when they really took care of you in your retirement. She had full and excellent medical coverage up until the day she passed away, almost 26 years after she retired. I know that’s a hard thing to find these days but I’m grateful for what they did for her and she was proud to work there.

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  9. AT&T does not have the ‘great’ lab that it used to any more. (comment by java2king). Bell Labs is part of Lucent now and is not innovating as much as it used to when it was part of Ma Bell. Budget cuts and defection of key scientists have taken their toll. Just imagine, a telco gave us the transistor, so they cant be all evil. :)

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  10. I feel the same way as OM. During my initial years as an immigrant, AT&T was synonymous with connecting to my folks back home. I have always had good experiences (customer service and voice quality) as compared with rampant phone slamming efforts from MCI. I spent a couple of year working at AT&T research Labs at Middletown, NJ and it was the greatest experience. It is difficult not be awed by pictures of luminaries like Shannon,and the first visit to their Global NOC center which houses the very first phone book and telephone etc makes you feel special to be part of it. Me, I am glad the AT&T brand is back. Hopefully, they will continue to innovate.

    CruzCat.

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