Failure of the mergers & A
Apart from the success of the mergers, Straub (Straub, 2007) states that companies face several problems and challenges. For example, AT&T Inc has received criticism that it finances political campaigns. Although these are allegations that the company has denied, this has tainted the company’s’ image. For the company to succeed, maintaining a good public image is vital. Therefore, allegations that the company is engaged in efforts that tend to give it some political support by funding political campaigns has damaged its image.
Though it was expected, the company has experienced economic pressures as a result of the current global financial crisis. This had the company in December 2008 make an announcement that it could cut about 12,000 jobs. This is an effort meant to enable the company address a changing business environment and the economic crisis. When expectations were being made about the success of the merger, risks and uncertainties were not anticipated to greatly affect the success of the new company.
The merger has however not been able to achieve all the estimated and expected results because the company has not been able to fully overcome risks and uncertainties that the economic crisis has resulted to. The Current position of the
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In total, about 150 million customers are served by the company, which makes the company one of the most successful in the US. As Roller et al (Roller et al, 2001) confirms, the company has managed to embrace new technology in the production and marketing of its product and services. The company is currently engaged in restructuring and has been involved in plans to develop various new media services to its customers . For instance, the sale of traditional home phone lines has declined with the introduction of new products.
Initiatives to provide customers with U-verse and video share are being made by the company. By launching a video share in 2007, the customers are now able (mobile callers) to stream line video between phones through a video share capable phone. The merger has succeeded in providing a larger number of consumers with its services and products as anticipated. For example, the expansion of the company has made the company to become the US second largest provider of the much demanded wireless service.
According to Hacker (Hacker, 2006), the company has also shown its desire to extend its service to more customers that it had earlier. One way through which the AT & T Inc. is trying to attract more customers is through the introduction of improved and new services and products. Research and development work at the company’s labs has promoted innovation and development of new products. Because the merger aimed at having the operations and management at Cingular streamlined, restructuring of the new company is being witnessed.
Many employees who earlier worked in the two companies before their merger have lost their jobs as AT & T Inc. try to direct its effort to bring the management of both companies under a single entity. The merger has had the former Cingular wireless changed into AT & T mobility. The AT & T Inc. has its headquarters in Dallas, while AT & T mobility headquarters is located in Atlanta. Products that are currently being offered by AT & T Inc. relate to the television, wireless, telephone, and internet. The operating income of the company is estimated to be 18.
165 billion US dollars, while the net income is US $ 10. 463 Billion. According to the 2008 statistics, AT & T Inc. has an estimated 303,000 employees and the new AT & T Inc. CEO and chairman is Randall Stephenson. By having the head quarters moved to Dallas, the AT & T can now be able to access more customers and provide their services and products much better to its customers. The AT & T currently owns about eleven Bell operating companies of the twenty-two that were owned by AT & T before its breakup in 1980s. These companies include the Michigan, Illinois, Indiana and Ohio Bells.
The Future of AT & T Inc The AT & T Inc. expects to lead in providing customers with wireless service in future. According to Haykin (Haykin, 2001), technological advancements in the telecommunication industry are expected to offer the company with opportunities to develop new products and to improve its services to customers. The AT & T labs are expected to assist the company in future to embrace new technology in its operation and service to the people. The company is currently working very hard to provide more benefits for its customers in future.
Because the AT & T Inc. has succeeded in providing benefits to the customers, this is expected in future to provide even more benefits to the customers. The need to embrace new technology has made the company to commit itself in future to embrace the internet protocol network -based technologies. AT & T Inc. hopes to take advantage of its strength to succeed in improving its operation and ensuring its stockholders get more benefits in future. The synergies from the combined companies during the merger are expected to increase in future.
The company in future aims at expanding its share repurchase. In 2006, the AT & T board of directors showed their support for an expanded share repurchase of the company. The merger will continue to increase the company’s technical, financial, network, research and development, and marketing resources. The company will then be in a good position to serve customers much better. By merging AT & T BellSouth, closer integration of the IP, wire line, and wireless services and products over one global IP network improved the company’s financial returns.
This will improve in future due to the streamlining of the company witnessed after the merger. Dalton et al( Dalton et al, 2004) considers an increase in financial returns as very beneficial to the company, since the resources can be channeled back to support efforts that will improve services. Research and development by AT&T Labs which requires huge amounts of resources to develop new products and services will be very advantageous for the company. Despite its success, the company faces several challenges.
For instance, some customers have indicated that they have had wireless network problems. Some customers after signing up for the company’s service have indicated their disappointment with the services. Although the company is accused of denying that it does not have any network band problems, it acknowledges that it has to face some challenges that will promote better service in future. The company will need to address such problems in future in order to succeed.
AT&T Inc in future aim to increase its access to adequate capital, to increase the market share, to better compete with the rival companies, and to increase the company’s ability to develop an effective risk management strategy. The desire for the AT&T Inc to lead in providing good services to customers in the era of bundled and converged communications, entertainment, and video services, while at the same time improving the company’s’ ability to manage complex networks is considered to be a great motivation to the future success of the company.