AT&T Wins $1.6 Billion Global Deal with Shell
Agreement Represents AT&T's Largest Contract Win to Date with Company Headquartered outside the US
AT&T to connect thousands of locations and manage Shell's mobility needs, delivering services/applications to 150,000 Shell employees worldwide
San Antonio, Texas, March 31, 2008
The Hague, Netherlands — AT&T Inc. (NYSE:T) announced today that Royal Dutch Shell (Shell) has selected AT&T to be its global provider of advanced communications services. The five year agreement, estimated to be worth $1.6 billion, calls for AT&T to provide, manage and maintain Shell's worldwide communications infrastructure while also managing the company's global mobility needs. It is one of the largest commercial contracts ever signed by AT&T, and it's the largest agreement signed with a company that is headquartered in Europe. The agreement is one of three outsourcing contracts signed by Shell with key suppliers for networking and IT services.
This agreement with Shell follows a series of other large and strategic wins AT&T has secured in the past year, including deals with Starbucks, General Motors, the U.S. Department of the Treasury, and IBM. All of these wins underscore AT&T's position as the leading global telecommunications service provider within the industry. The agreements with GM and the Department of the Treasury are each worth up to $1 billion; the IBM agreement is worth up to $5 billion.
Once the contract with Shell has been implemented, AT&T will provide managed network services to Shell and its subsidiary companies in more than 100 countries. AT&T will deliver wide area and local area networks, voice services (including Internet-based telephony), managed security solutions and mobility services. Shell will benefit from access to AT&T's advanced global Internet Protocol (IP) network to deliver cost effective, consistent, secure and highly reliable services.
AT&T will provide direct connectivity to 1500 Shell corporate and operating unit locations underpinning a range of services critical to Shell's operations. AT&T will also manage more than 600 separate third party contracts with more than 300 vendors around the world. These contracts include agreements for local connectivity provided by regional telephone companies, contracts with individual service providers and various other maintenance and operations deals.
Shell employees will have access to AT&T's industry-leading position in the wireless space both within and outside the United States and AT&T will manage the cellular services contracts provided by other mobile operators. AT&T will also support remote data access to Shell's Virtual Private Network (VPN) service for more than 50,000 traveling users and home-based workers.
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.
Shell chose AT&T after an extensive evaluation and procurement process. AT&T was able to offer Shell a world-class portfolio of IP-based products and services, a consistent global approach to its operations, and the significant local support Shell needs around the world. In addition, AT&T, a world-class networking provider, will be able to offer IT professionals who are expected to transfer to AT&T as part of the agreement the opportunity to further develop their skills and careers
"This important agreement with AT&T reflects our determination to accelerate Shell's essential IT capability, optimize our operations and ensure we can provide best-in-class IT services to support our global business," said Alan Matula, Executive Vice President & Chief Information Officer for Shell.
Shell will retain core skills within its own IT organization, while being able to access AT&T's world-class expertise in networking. Plus Shell will benefit from AT&T's significant economies of scale. Approximately 560 Shell networking professionals located predominantly in the Netherlands, Malaysia, the U.K. and the U.S. are expected to transfer to AT&T, joining the company's worldwide workforce of 300,000. AT&T will create dedicated service units in these key hubs to ensure that Shell receives continued support at these locations.
"We are delighted that Shell has chosen AT&T as its leading global networking solutions provider," said Ron Spears, AT&T president, Global Business Services. "We are committed to connecting Shell's worldwide employees, partners and suppliers, while delivering and managing the array of managed network services needed for the company to accelerate its business performance.
"Providing connectivity and applications to world-class companies like Shell is AT&T's core mission," said Spears. "I have every confidence that AT&T will exceed Shell's expectations for anytime, anywhere global communications."
AT&T provides advanced communications services to every company on the Fortune 1000 listing. Large global corporations and organizations are entrusting AT&T to build IP-based networks that will serve as the telecommunications and I.T. backbone for the achievement of their strategic business goals. Through the agreements with companies and agencies like GM, IBM, and the Department of the Treasury, AT&T has been able to demonstrate that it has the scale and scope required to execute these complex arrangements on a worldwide basis.
Additionally, the contracts reflect how AT&T is capitalizing on the ongoing shift in network traffic from voice to data — and more importantly to IP-based data — as customers migrate from legacy packet networks to Multiprotocol Label Switching (MPLS)-based VPNs and managed applications. The company offers its multinational customer base consistent, resilient, standardized IP services around the world. These services include IP-based VPNs, which use the latest MPLS technology, and are complemented by an advanced portfolio of data-hosting services, applications and leading IP security offerings.
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Royal Dutch Shell plc is incorporated in England and Wales, has its headquarters in The Hague and is listed on the London, Amsterdam, and New York stock exchanges. Shell companies have operations in more than 130 countries with businesses including oil and gas exploration and production; production and marketing of Liquefied Natural Gas and Gas to Liquids; manufacturing, marketing and shipping of oil products and chemicals and renewable energy projects including wind and solar power. For further information, visit www.shell.com.
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