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Jan. 26, 2007

Yesterday, AT&T said it posted strong 4th quarter earnings, with revenues up 23 percent to $15.9 billion, and profits up 17 percent to $1.9 billion.

Overall, last year AT&T earned $7.3 billion (up 53 percent) with revenues of $63 billion (up 44 percent).

AT&T earnings were boosted by the projected cost savings of its merger with SBC two years ago, which totaled $1.1 billion, a good $300 million better than it anticipated.

With its recent merger with BellSouth, AT&T believes it can further improve its cost structure for this year, especially by rejoining Cingular Wireless with AT&T.

Overall, Cingular's earnings bounced up in the fourth quarter of last year, and AT&T chairman Edward E. Whitacre Jr. noted that wireless amounts to 34 percent of the merged company's business.

Another positive for AT&T came via its U-verse service, which launched in 11 markets last year, and will include four more early this year.

With 70 percent of U-verse subscribers choosing the fastest broadband speeds and higher-end video packages, AT&T sees this as a solid business.

Nevertheless, sticking points still remain.

AT&T’s decision to continue to deploy its FTTN (Fiber-to-the-Node) network rather than FTTH (Fiber-to-the-Home) that Tellabs has being doing for BellSouth calls to question what will happen with certain equipment suppliers.

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Source: Wireless Week