Mr. Stephenson to become AT&T’s Chairman and CEO

AT&T said on Friday that Mr. Edward E. Whitacre Jr., current chairman and CEO, will retire in June after 17 years at the helm. Mr. Whitacre worked his way up as a manager and navigated through the breakup of the Bell system in 1984. When he became CEO in 1990 he began to work on putting it back together with a string of acquisitions that culminated with a $85 billion deal to take over BellSouth and gain full control of the two companies' joint venture, Cingular Wireless. Today, AT&T is the biggest service provider in the world based on market cap, with a very different business than 17 years ago. Huge round of applauses for Mr. Whitacre.

Welcome Mr. Randall Stephenson. When he joined AT&T in the information-technology department, the company was known as Southwestern Bell Telephone. He has spent most of his career overseeing telecom finances in various positions. In 1996, he was named controller, and also has served as senior vice president for consumer marketing. As chief financial officer he reduced the company's net debt from $30 billion to nearly zero by 2004, positioning AT&T for future takeovers. Mr. Stephenson was always loyal to Mr. Whitacre and supported him to grow AT&T from a small Baby Bell into a super-sized phone giant. Another round of applauses for Mr. Stephenson.

Now, let’s focus on the huge business challenges for Mr. Stephenson. For starters, AT&T will be looking to become the preferred provider of telecommunications services to multinational corporations around the world. They will also look for business partners rather than make large acquisitions. Secondly, a new set of competitors is coming up, such as Google and cable companies, which have aggressively entered the phone business. Third and most importantly, he will have to face that its landline phone service business is slowly dying in the age of wireless and Internet telephony.

Welcome Mr. Wireless. Mr. Stephenson expects to use the massive appeal of Apple and its soon-to-come new iPhone to attract new subscribers from other competing carriers. The battle began a while ago when AT&T gave up several conditions to win the exclusive rights to offer the Apple device through its wireless unit, formerly called Cingular Wireless. He is also making other aggressive moves, such as rolling out a mobile-broadcast TV service. Further, he is entering into the advertising world with his three-screen strategy, selling ads to appear on mobile phones, the Internet and its television service.

So, there is no question that Mr. Stephenson will face very interesting times at the helm on AT&T. It will be entirely up to him to survive and excel in this frenetic race to capture customer attention. And that is not minor challenge these days…