AT&T Inc. · NYSE:T
AT&T — SBC Communications — J.P. Morgan Technology & Telecom Conference 2004
25 slides from AT&T's conference presentation, May 4, 2004
Slide 1: Strategy and Execution: SBC Investor Update
Strategy and Execution: SBC Investor Update J.P. Morgan Technology & Telecom Conference MAY 4, 2004 Forrest Miller Group President-Corporate Planning SBC Communications Inc.
Slide 2: Cautionary Language Concerning Forward-Looking Statements
Cautionary Language Concerning Forward-Looking Statements Information set forth in this presentation contains financial estimates and other forward-looking statements that are subject to risks and uncertainties. A discussion of factors that may affect future results is contained in SBC’s filings wit
Slide 3: U.S. Telecom Market – Product View
U.S. Telecom Market – Product View 2003 (in billions) $9 $14 Total = $71 $47 $97 $54 $38 $40 ~$370 Local LD Wireless Mgd. Bus. Cable DBS Svcs. Data <0% CAGR <10% CAGR >10% CAGR Consumer Data Note: Business Data includes ATM, Frame Relay, ISDN, T1 – including voice over PL, etc., Local includes acces
Slide 4: Key Strategic and Operational Focus Areas
Key Strategic and Operational Focus Areas 1 Bundles • Drive retention • Strengthen ARPU • Include video 2 Wireless • One of industry’s best growth segments 3 Large Market Business • Natural area for expansion with LD entry
Slide 5: Major Advances in All Three Areas
Major Advances in All Three Areas • 50% consumer key product Bundles bundle penetration • Successful video launch Wireless • Agreement to acquire AWE • Rapid, highly successful GSM deployment Large • Nationwide IP network in place Business • Expanded global sales organization Market • Winning contra
Slide 6: Bundling strategy and execution
Bundling strategy and execution
Slide 7: Strong Long Distance Growth
Bundling Strong Long Distance Growth In-Service YOY Growth InterLATA PICs Total LD Revenue (in millions) 17.0 29.6% 14.4 27.6% • 2.6 million LD lines added 11.5 in 4Q03 9.8 • 9.4 million 7.6 12.5% LD lines added over past four 4.1% quarters (2.2)% 1Q03 2Q03 3Q03 4Q03 1Q04 1Q03 2Q03 3Q03 4Q03 1Q04
Slide 8: Robust DSL Growth
Bundling Robust DSL Growth DSL Net Adds (in thousands) 446 • 9th consecutive quarter of accelerated net adds 377 365 • Driven by continuous innovation 304 270 – Launched 1.5 – 3.0 245 Mbps speed tier service 226 213 – Strengthened retail and 183 1.5 million DSL online distribution; 20% lines added o
Slide 9: Strong DSL Trends
Bundling Strong DSL Trends Broadband Net Adds (in thousands) DSL/Cable Modem 446 SBC Lines in Service 450 End of 1Q04, in Millions 377 Comcast 350 365 Verizon SBC 4.0 304 Verizon 2.7 270 BellSouth 1.6 250 245 Comcast 5.7 Time Warner Time Warner 3.4 150 Cox Cable Cox 2.1 BellSouth 4Q02 1Q03 2Q03 3Q03
Slide 10: Dramatic Growth In Consumer Bundles
Dramatic Growth In Consumer Bundles Key Product Bundles customers with bundles including one or more key services – LD, DSL, wireless or satellite video 50% 44% • ARPU for customers in 36% a bundle is more than 31% double that of those without a bundle 23% 19% 4Q02 1Q03 2Q03 3Q03 4Q03 1Q04
Slide 11: Successful SBC | DISH Network Launch
Bundling Successful SBC | DISH Network Launch Installed Base • Launched service in March DISH DISH America’s Latino Latino America’s • ARPU above $60 Top Top 60 60 13% 13% 17% 17% • Nearly 80% of the America’s America’s customers are bundling Top Top 180 180 18% 18% satellite with at least one Ameri
Slide 12: Wireless strategy and execution
Wireless strategy and execution
Slide 13: Solid Organic Subscriber Growth
Cingular Wireless Solid Organic Subscriber Growth Cellular/PCS Subscribers in Service (in millions) 24.6 24.0 • 554,000 net adds – nearly triple last year’s 23.4 first quarter • 2.5 million gross adds – 22.6 third straight quarter with gross adds at or 22.1 above this level 2.5 million net adds • Ch
Slide 14: Approaching 100% GSM/GPRS Coverage
Cingular Wireless Approaching 100% GSM/GPRS Coverage Cingular Subscribers With GSM-Capable Handsets 53% • 100% GSM/GPRS 45% network coverage targeted for July 35% • Customer response continues to be very 27% positive – Wide range of 66% of Cingular’s handsets minutes now on GSM/GPRS network – Truest
Slide 15: Cingular Wireless Licensed Spectrum
Cingular Wireless Licensed Spectrum Seattle Portland Minneapolis Milwaukee Buffalo Boston Cleveland Chicago Pittsburgh Salt Lake New York City Kansas City Denver Cincinnati Baltimore San Sacramento Washington, D.C. St. Louis Louisville Francisco San Jose Norfolk Las Vegas Nashville Greensboro Los An
Slide 16: Cingular + AT&T Wireless
Cingular + AT&T Wireless Seattle Portland Minneapolis Milwaukee Buffalo Boston Cleveland Chicago Pittsburgh Salt Lake New York City Kansas City Denver Cincinnati Baltimore San Sacramento Washington, D.C. St. Louis Louisville Francisco San Jose Norfolk Las Vegas Nashville Greensboro Los Angeles Oklah
Slide 17: Outstanding Strategic Fit
Outstanding Strategic Fit • Network Technology – Both networks GSM/GPRS – Used by > 70% of world’s digital wireless market – Robust platform for emerging wireless data services • Customer Base – Cingular has broad consumer base – AT&T Wireless has extensive business customer base, providing service
Slide 18: Large Business Market strategy and execution
Large Business Market strategy and execution
Slide 19: Data Revenues
Data Revenues Quarterly Data Revenues (dollars in millions) $2,604 $2,647 $2,576 $2,491 • Data revenue up 6.8% • Solid Hi-cap data revenues • Strong growth in DSL/Internet DSL/Internet Data Integration Hi-cap Transport 2Q03 3Q03 4Q03 1Q04
Slide 20: Leader In Data Revenues
Leader In Data Revenues 1Q04 Total Data Revenues (dollars in billions) $2.6B • Largest data revenue $1.9B stream among RBOCs • 40% higher than closest peer $1.1 BellSouth Verizon SBC
Slide 21: Large-Business Opportunity
Large-Business Opportunity $140B Business Telecom Market (voice and data) SBC’s immediate large business target – companies with more than 50% of their locations in footprint – represents 10% $14B $34 billion annual revenue opportunity SBC Market Share Today $140 billion includes voice, data, manage
Slide 22: Expanded Capabilities
Expanded Capabilities Service Network Products Sales Capabilities National ATM Broad range Single 4,300 and Frame of flexible Global advanced data backbone, bandwidth Accounts certifications IP network solutions sales team Single Managed contracts, Services service level agreements
Slide 23: National IP Backbone
National IP Backbone Seattle Boston Minneapolis Salt Lake Detroit San Francisco Chicago Denver New York City Pleasanton Cleveland Kansas City Santa Clara Washington, D.C. Anaheim Los Angeles Irvine Phoenix Richardson Atlanta Dallas Houston Tampa Miami
Slide 24: Innovations in IP Platform Services
Innovations in IP Platform Services Business Consumer • Hosted IP Communications • Developing services Service (HIPCS) with new features and – Advanced features functionality, including Unified Communications – Cost efficiencies • Integrates wireline, • Premises-based IP solutions wireless and Inter
Slide 25: SBC Strategic Focus Areas
SBC Strategic Focus Areas • Strong execution driven Bundles by LD and DSL • SBC | DISH Network adds key video component Wireless • Leadership in GSM • AWE acquisition adds scale, coverage Large • Large opportunity • Expanded capabilities Business • Gaining traction Market
SBC Communications — J.P. Morgan Technology & Telecom Conference 2004 on 6ix