AT&T to Invest $1 Billion in Global Network and Services for Multinational Customers in 2008
Global Networking Platform for Delivering On-Demand Network Applications Is Key to AT&T Efforts
San Antonio, Texas, March 5, 2008
AT&T Inc. (NYSE:T) today announced plans to invest $1 billion in 2008 to continue the expansion of AT&T's industry-leading network and portfolio of solutions for multinational companies with operations and applications in key markets worldwide.
The 2008 program — which is 33 percent more than last year's enterprise investment and more than double AT&T's investment in 2006 — is being driven by demand for Internet Protocol (IP) networks and services as companies deal with the explosive surge in data, voice and video traffic made possible by the proliferation of high speed networks and devices worldwide.
Responding to this demand, AT&T is accelerating its efforts to: 1) extend its global network reach and capacity; 2) globalize its portfolio of business services and 3) embed the latest utility computing and other technologies in the network so that companies can deliver real-time applications to their customers, suppliers and partners.
In 2008 AT&T plans to invest in:
- New subsea fiber optic cable capacity to Japan and Asia, increasing diversity and reliability on these critical routes. This would include increased investments in multiple under sea cable systems into South East Asia and Australia, investment in several subsea cable system upgrades to significantly grow capacity on multiples routes in the Caribbean, including Puerto Rico, as well as subsea investments on existing cables servicing India and the Middle East. These subsea investments will be used to extend AT&T's intelligent optical network into Europe and Asia with optical mesh restoration.
- New core MPLS routers in Europe, Asia and the U.S., and the expansion of access to AT&T's global network with new or additional MPLS based IP network access nodes in Europe (Paris, Moscow), the Middle East (Kuwait), India (New Delhi, Kolkata), Japan, Asia (Seoul, Shanghai, Singapore), and Central America (Guatemala).
- New network-to-network connections to extend network reach into high growth markets in Asia Pacific (India, Australia), Eastern Europe (Russia, Kyrgyzstan, Belarus, Mongolia) and South America.
- Enhanced Ethernet network capabilities with the rollout of a global virtual private local area network solution, initially in the U.S., Europe and Asia Pacific. In 2008 AT&T plans to make these services available in 14 cities — Frankfurt, London, Brussels, Paris, Amsterdam, Stockholm, Dublin/Cork, Milan, Madrid and Zurich in Europe; and Hong Kong, Sydney, Singapore, Tokyo in Asia Pacific. By year-end 2008, AT&T expects to have an Ethernet footprint in 39 countries.
- Adding DSL as an emerging access alternative to China, Finland, Norway and Saudi Arabia. By year-end, DSL will be available as an access alternative in 21 countries.
- Increasing data center hosting capacity with an additional 180,000 square feet of global capacity by mid 2009 throughout the 38 data centers AT&T has deployed globally. Expansion targets in 2008 will include space augmentation in Singapore, Amsterdam, Boston and Dallas.
- New application performance management tools within AT&T's industry-leading AT&T BusinessDirect® portal to help companies manage and monitor their networks and services online, giving them greater control and flexibility.
- Integrating and developing unified communications capabilities made possible by the recent acquisition of Interwise, a global provider of Web-based and audio conferencing services to accelerate AT&T's move into the unified communications space.
- Integrating the global network operations and processes acquired through AT&T's recently expanded networking agreement with IBM, thus enabling greater scope and scale than ever before.
- Offering global IP-based audio-conferencing services with in-country dial-in access from more than 140 countries, with in-language support.
These investments complement AT&T's industry-leading position in the mobility space. Today, AT&T offers the largest integrated GSM network in the U.S., covering 290 million people, and has the largest international coverage of any U.S. wireless carrier. Customers can make calls on six continents and in more than 200 countries — with wireless data-roaming in more than 145 countries for laptops, PDAs and other data services and third-generation (3G) service in 60 countries.
"Companies worldwide are responding to the exploding need to deliver voice, data and video in real time to their end-users, no matter where they are, no matter what the device," said Ron Spears, group president, AT&T Global Business Services. "It is vital that we continue to invest in those geographies and services to meet this demand so our customers can connect their operations, partners and suppliers."
AT&T continues to capitalize on the ongoing shift in network traffic from voice to data — and more important to IP-based data — as customers migrate from legacy packet networks to MPLS-based VPNs and managed applications. These trends returned the AT&T Global Business Services' unit within AT&T to year-over-year revenue growth in recurring enterprise services in the third quarter of 2007, a year ahead of expectations. As previously announced, in the fourth quarter of 2007, hosting revenues grew by 19 percent, enterprise IP data services by 20.9 percent, and VPN revenues by 31 percent.
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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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