Everybody is predicting doom and gloom (in five years, decade, two decades,) but realistically speaking, I think AT&T is too big to go under, no matter how many bad decisions the management makes. It might change, reorganize, shrink, adapt...but it'll still be standing at the end of it all.
Am I wrong?
AT&T has already failed. AT&T Corp that is. Assuming the name and repeating the buying practices that lead to the failure of Corp is a lesson that Inc failed to learn. It will meet the same fate! Karma!
$91B is a nice number, 60% of that (or $54b) goes to paying dividends to investors, the rest for other ventures and paying down debt is part of the plan.
Now you have T closing Buildings, in all categories, to eliminate the expense of leasing or owning, from California to New Jersey. Jobs surplussed, no more 401K matches, reduced medical, etc. AT&T, like it or not, is pulling out all the stops to survive, pay down debt and move forward......just imagine what could be done with decent management!
Yes, they will survive, with or without us and I don’t have to like it but I understand it.
The McJob is a pretty good analogy. Lot of that is that we no longer have the distinction of being the only company providing communication services. If Google was around then and you did a search for telephone service there would only be one name that came up in most parts of the country. 100% market share was a good thing. Bet McDonald’s would love to be the only burger joint in the country.
I'm confident that T can find a way
Profits last year: $91 Billion. Profits 2005: $24 Billion. How can I fail like this too?
To a large extent, AT&T has already failed. At one time, Bell Labs was an innovative leader in global technology, being awarded more patents than any other business. Is AT&T an innovative leader now? Absolutely NOT. AT&T is a follower now. The only way they can pretend to be innovative is by gobbling up small creative companies.
At one time, a job at AT&T was one of the most lucrative blue or white collar jobs in America. Once someone got in with AT@T they stayed for life. AT&T's employees were proud of their jobs and strong ambassadors for their company. Now, I'm embarrassed to even tell people where I work. This is just a lousy McJob now, and that's assuming you're not part of the legion of employees being cut every quarter.
Companies that lose their cultural values and their fiscal discipline don't usually last very long. AT&T may collapse quickly, or it may be a slow death spiral, but this company has no future.
A lot of the massive overlay was due to a government mandate. They have no intention of putting a fiber fed small cell within a few hundred feet of every home in America for optimum 5G usage. Fiber deployment is going to be more strategic.
No company is too big to fail. The main disadvantage for a big company is smaller leaner more agile companies will innovate faster and undercut them. Wireless voice and text is a good example. Also see Hulu, Netflix, etc.
Price sensitivity is a looming threat across all T businesses.
AT&T's traditional businesses are stagnant. Yes, a lot of revenue generated by wireless, but new organic growth is a thing of the past. Everyone that wants a device has one and they are not upgrading $1000 phones every year or two or three. I still use a iPhone 6. Why upgrade? It does everything I want it to do.
Fiber is growing and they are shutting overlay construction down. Brilliant. If they started their fiber build decades ago, natural attrition through retirement would take care of the wireline headcount problem.
DTV is losing customers to cord shaving or cord cutting.
Time Warner is the only potential growth component but the old line telco management style won't work in a talent centric business. It will be metric'd to death. Sausage over steak.
I don't think T will fail, it is more likely they will not succeed to their expectations. Not #1 2 or 3 but 5 6 or 7 and that won't increase the stock price or grow the dividend.
I’ve thought about this. Yeah I think we are “too big to fail” BUT this current administration is not fond of CNN and the media so if something terrible happened here on Trump’s watch, I’m not sure we would get a bailout like Chrysler did.
Too big to fail just means too politically connected mostly. I don’t think T has the political capital. Let’s just hope T doesn’t pull a Netflix, Disney or d---s move and go all social justice warrior on us. Extremely ignorant to alienate 50% of your customers. Companies should stay out of politics imo.
@qqn, not sure what your point was suppose to be. But if you’re looking for the hypocrisy angle, here’s one. That iPhone of yours, the Washer & Dryer, Microwave, refrigerator or clothing in your apartment or home.....probably made in China, right? How does that square with the Muslims in a Chinese internment camps?
Let us know how you’re evolving with that.
The biggest component of AT&T, by revenues is wireless. And wireless isn't going anywhere. There has been talk about 5G replacing traditional home internet.
The item going the way of the dodo bird is landline telephony, much like the stage coach and buggy whip before. New technologies, obsolescence ...
I have Voip, but I just got my Cell2Jack. Just like when I'm in the car, the car connects to the phone, now, when my cellphone is in the house, it connects to the Cell2Jack which connects to the inside wire. So, now all the home phones can call through the cell phones. New technologies ...
Not sure how we can grow revenue without getting into new ventures with so much of the older lines of business going away because of technology. I also don’t believe there is a 1 to 1 correlation between the debt and revenue growth. Reading this board there is no doubt that some of the chain saw cutting of personnel in some areas are affecting projects being finished which are revenue affecting. It seems that they have gone all in on the new technologies minimizing some of those cuts. Listened to the Scott Mair webcast and he is the 3rd executive that has mentioned how the massive wireless build (First Net, 5G, Fiber, etc) is starting to show up in some business customers looking to go completely wireless. He, RS, and our CFO have all briefly touched on this subject. Can you imagine the affect if these touch points start to go away over time.
Companies that don't innovate, evolve and grow revenue organically are eventually doomed.
I wouldn't count T out yet, but it is disturbing that in recent years the company has grown revenue only by buying other companies. Now the massive debt will preclude that from happening for some time.
While T has a great assortment of assets, it's time to grow or there will be immense pressure to break it all up down the road. Wall Street loves the term, "unlocking value." You only need to look as far as GE selling off assets and Lucent (formerly Western Electric & Bell Labs) being bought to see what the future could hold.
I'm not smart enough to know how this will play out in the long run, but there are many examples of once great companies that have disappeared. I hope Randall's strategy is right and the company executes it well. Anyone receiving a salary or pension is depending on it.
@Zk2Q5tU-dcf Since you brought up Disney here's a nugget for ya. EXCLUSIVE: Disney CEO says it will be 'difficult' to film in Georgia if abortion law takes effect. But.... Disney apparently has no issue with doing business in China, which has undertaken mass detentions of Uighur Muslims, placing them in internment camps. Evolving?
No company is too big to fail, as our last Great Recession proved. If not for the government bailout of General Motors, many of the US cars we drive today might have been Imports. Financial institutions closed, and those that didn’t need a serious infusion of cash.
Survivors evolve, they change their methods or go bankrupt, or merge (get absorbed) with other companies. When the “Bell System” split up, competition among the baby bells forced every other bell to step up their game in order to compete....that was a good thing.
AT&T (SBC) is attempting to do this as their Warner Media attempt shows, too broaden their base of customers. Disney, as an example, owns ABC Television Group, ESPN, Inc, Lucas Film Ltd, Marvel Entertainment also trying to broaden their base, and no longer the theme park, or cartoons created decades ago.
IBM & Honeywell each own at least 5 other companies, like many other big corporations....evolve or die.
Hey OP Post ID: @Zk2Q5tU-cqj
Do you mean fade away like when AOL was selling more dial-up service than what their existing infrastructure could handle? Then there was a lot of complaining and news, and AOL just kind of faded away?
IMO, You could not be more wrong in your thinking. Look at GE, Honeywell, IBM and a slew of others. There are a significant number of companies that just fade away into insignificance and slip from most people's consciousness.
New companies are created almost every day, while others just fade away.
What you are really talking about here and don't even realize it, is the fading away of the greatest company on Earth in her day - The Bell System. There are only remnants left of this great company. Most of it is already gone.
There are a lot of people on this site that probably don't even know what the Bell System was. The company mentioned in this post doesn't even deserve to be mentioned in the same paragraph as the Bell System. They have "PacMan'ed" their way to where they are now. And have a massive debt to prove it.