ACC3214 Business Life Cycle Of AT And T Assessment Answer

Provide the description of the assignment and the tasks required.

Part 1: Individual Report (80%)

About AT & T

AT & T, formerly known as SBC Communications Inc. (SBC), was formed as one of several regional holding companies created to hold AT & T Corp.’s (ATTC) local telephone companies. On January  1, 1984,  the company was spun-off from ATTC pursuant to an anti-trust consent decree, becoming an independent publicly traded telecommunications services provider. At formation,  the  company  primarily  operated  in  five southwestern states.

Following the formation, the  company  has  expanded  its  footprint  and  operations  by  acquiring  various business, most significantly:

• The subsidiaries merged with Pacific Telesis Group in 1997, Southern New England Telecommunicat ions

Corporation in 1998 and Ameritech Corporation in 1999, thereby expanding the company’s wireline operations as the incumbent local exchange carrier (ILEC) into a total of 13 states.

• In 2005, the company merged one of our subsidiaries with ATTC, creating one of the world’s leading telecommunications providers. In connection with the merger, the name of the company was changed from “SBC Communications Inc.” to “AT&T Inc.”
• In 2006, the company merged one of the subsidiaries with BellSouth Corporation (BellSouth) making the company the ILEC in an additional nine states. With the BellSouth acquisition, the company also acquired BellSouth’s 40 percent economic interest in AT&T Mobility LLC (AT&T Mobility), formerly Cingular Wireless LLC, resulting in 100 percent ownership of AT&T Mobility.
• In 2014, the company completed the acquisition of wireless provider Leap Wireless  International,  Inc. and sold our ILEC operations in Connecticut, which we had previously acquired in 1998.
• In January and April 2015, the  company  acquired  wireless  properties  in  Mexico,  and acquired  DIRECTV, a leading provider of digital television entertainment services in both the United States and Latin America.
• In June 2018, the company acquired Time Warner Inc. (Time Warner), a leader in media  and entertainme nt that operates the Turner, Home Box Office (HBO) and Warner Bros. business units. The company  also acquired Otter Media Holdings August 2018 and advertising platform AppNexus in August 2018.

In late 2019, the company announced the sale of wireless and wireline operations in Puerto Rico and the  U.S. Virgin Islands; the sale is expected to close in mid- 2020

 AT & T’s mission

Inspire human progress through the power of communication & entertainment.

 AT & T’s values

Live true. Do the right thing, no compromise.

Think big. Innovate and get there first.

Pursue excellence. In everything, every time.

Inspire imagination. Give people what they don’t expect. Be there. When customers and colleagues need you most. Stand for equality. Speak with your actions

Embrace freedom. Press, speech, beliefs.

Make a difference. Impact your world.

AT & T Operating Segments

AT & T Communications

AT&T Communications provides more than 100 million U.S. consumers  with  entertainment  and communications experiences across  TV,  mobile  and  broadband  services. It has the nation’s best network and, for the 5th quarter in a row, fastest wireless network.3 It also serves nearly 3 million business customers

— including nearly all of the Fortune 1000 — with high-speed, highly secure connectivity and smart solutio ns. 2019 revenues of $142.4 billion.

Mobility (U.S.)

The Mobility segment provides nationwide wireless service to consumer, business and wholesale  subscribers located in the United States and in U.S. territories. The company’s wireless network powers voice and data services, including high-speed internet and video entertainment.

Entertainment Group

The Entertainment Group provides video, including over-the-top (OTT) services, broadband and voice communications services primarily to residential customers.

Business Wireline

The Business Wireline segment provides advanced IP-based services, as well as traditional voice and data services to business customers.

WarnerMedia

WarnerMedia is a leading media and entertainment company that creates and distributes premium and popular content from a diverse array of talented storytellers and journalists to global audiences. WarnerMedia’s brands operate one of the world’s largest TV and film studios and own a  deep library  of entertainment.  They  also manage popular digital sites such  as Bleacher  Report and  a growing  family  of streaming  services  includ ing HBO NOW, Boomerang and DC Universe. WarnerMedia also offers  a  strong  portfolio  of  advertising  solutions. On May 27, 2020, WarnerMedia plans to launch HBO Max, its new  streaming  platform.  2019  revenues of $33.5 billion.

Turner

Turner delivers some of the most valuable brands in the world across entertainment, sports, news and kids programming. It boasts more than 175 international networks,  including the #1-rated pay-TV network portfolio in Latin America. Turner also sells advertising on its networks and digital properties.

Home Box Office

Home Box Office  has  world-class  premium  video  and licenses  its  programming  in  more  than  150 countries. It offers premium pay television and OTT services domestically and premium pay, basic-tier television, and OTT services internationally. HBO is known for its ground-breaking original series, popular  late-night programs, compelling sports shows, award-winning documentaries, as well as Hollywood blockbusters.

Warner Bros.

Warner Bros. is a leader in global entertainment and is the world’s leading producer of film and televis ion programming. Its vast library includes more than 100,000 hours of programming and is home  to some  of the most beloved franchises in entertainment,  including  DC Entertainment,  Harry Potter and Lord of the  Rings.  It also produces and distributes video games.

AT&T Latin America

AT&T’s Latin America segment offers mobile services to consumers and businesses in Mexico and digita l entertainment services throughout South America and the Caribbean. 2019 revenues of $7.0 billion.

Vrio

Vrio  provides  video  services  to customers  using satellite technology in  Latin  America  and the Caribbean.  It is a leader in providing digital entertainment services in those regions through  its  DIRECTV  and  SKY Brasil brands. The company also has a minority stake in Sky Mexico.

Mexico

The company’s  Mexico  business  unit  provides  wireless  service  and equipment  to customers in Mexico. AT&T is the fastest-growing wireless provider in Mexico  and is  transforming  telecommunications  across the country and helping to accelerate the closing of the digital divide.

Xandr

Xandr is AT&T’s advertising company and a leader in  addressable   TV,  creating  a  better  solution  for advertisers and media  companies. Xandr  provides  marketers  with  advanced  advertising  solutions  using valuable customer insights from AT&T’s TV, mobile  and broadband services  and its  extensive  ad inventory. Xandr Invest and Xandr Monetize, its strategic platforms built  on  more  than  a  decade  of  AppNexus’ innovation, optimize media spend across screens for buyers and sellers alike. Community, powered by Xandr, is a curated marketplace of premium publishers, providing access to unique consumer insights in a brand-safe environment. 2019 revenues of $2.0 billion.

Exhibit 1: Operating revenues and operating contribution of the reportable segments

Exhibit 2: Results of operations

Exhibit 3: AT & T Historical Financial Performance AT & T Selected Financial and Operating Data Dollars in millions except per share amounts

Exhibit 4B: Verizon Stock Price Performance

The telecommunications industry

As major networks and studios continue to launch their own direct-to-consumer streaming services in 2020, competitors will likely scramble to offer content libraries broad enough to both attract and retain customers. According to Kevin Westcott, vice chairman and US telecommunications,  media,  & entertainment  leader, Deloitte  Consulting LLP,  this creates opportunities for M&E firms to “reaggregate” their content libraries with a wide array of offerings—from video, music, and gaming services to ad supported (non-subscript ion) content. Telecommunications providers, on the  other  hand,  face  the  opportunities and challenges of building the infrastructure for 5G—and helping shape (and manage) customers’ expectations regarding its possibilit ies.

Strategies used

The portfolio of businesses that AT & T has built, both organically and inorganically, has provided an enviable competitive advantage in 4 essential areas:

1. Advanced high-capacity networks built on a foundation of high-quality spectrum.
2. A large base of direct consumer relationships across mobile, pay TV and broadband.
3. Scaled capabilities to produce premium TV, theatrical and gaming content, coupled with one of the  deepest and richest content libraries anywhere.
4. Advertising technology and inventory that enable the company to make the  most  of the insights  collected from the customer relationships.

“We remain committed to investing in growth opportunities for the business now and in the future, returning value to shareholders through dividends and paying down debt.”

Randall Stephenson

Chairman and Chief Executive Officer

Key 2020 Initiatives

Elements of a Modern Media Company

Networks

It all  starts with  advanced  high-capacity  networks.  It was clear early  on that the mobile  internet  revolution  and a world of streaming video would require much more capacity than  people  were  anticipating.  So,  AT  & T began investing for future demand.

These investments included well more than $30 billion  over  the  past 7 years  in  premium  spectrum  licenses and the acquisition of Leap Wireless, which gave the company additional spectrum.

The company also were selected by the U.S. government to build and manage the FirstNet first responder network. This brought with it another layer of premium spectrum capacity.  Over  the  past  two  years,  the company has put this capacity  into  service  with  dramatic  performance improvements. As a result,  AT&T  has the best and fastest wireless network in the United States.3

By first-quarter 2020, we had launched 5G to more than 120 million people, and we expect to have nationw ide coverage in summer 2020.

The company has also invested in high-capacity networks in Mexico. In 4 years, the company has built a high- speed, nationwide mobile network and have more than doubled the customer base.

Since 2015, the company has also undertaken  the  most  aggressive  fiber  deployment  program in  the  U.S. — with more than 22 million locations passed.5

Over the next 3 years, this strong spectrum position will  allow  lower  capital intensity  and increased  revenues,  and that bodes well for growing operating margins.

Consumer Relationships

Direct consumer relationships are the second essential element in this strategy and the company has about 170 million of them across mobile, pay TV  and broadband.  That  number  climbs to more than 370 million whe n you include viewers on digital properties, including CNN.com and Bleacher Report.6

As the company prepares to launch HBO Max, these direct consumer relationships are an asset that any media company would love to have.

Gaining scale in linear pay TV was the core rationale behind  the DIRECTV  acquisition.  The company  realized the satellite business was mature. The company anticipated  subscriber  losses.  But  the  content  cost savings quickly turned the  U-verse pay TV business  from a loss to a profit. And since the company bought DIRECTV, it has generated healthy cash flows of $4 billion or more per year and a total of $22 billion by the end of 2019.

Premium Content

Third, the company believes that the value of premium  content  will  only  increase over  time  as consumer  demand continues to grow and new video engagement  formats  made  possible  by 5G emerge.  And  investors have been able to see the value increase with some of the multiples paid for media companies  after  the Time Warner deal.

The old business models in which premium content  is  created  for  distribution  exclusively  through  such traditional channels as theaters, cable and satellite companies just are not sustainable. Technology is driving

these business models together, and the company believes those companies that can integrate scaled content  creation businesses with scaled distribution will hold a critical advantage in the years to come.

Ad-Tech

Last, AT&T’s vast distribution network and subscriber base bring valuable viewer and customer insights. That provides a unique opportunity to create an ad-tech platform and pair it with the company’s large advertising inventories. In 2019, the company launched Community, a premium video marketplace for buyers and sellers. Building upon these 4 critical capabilities positions the company in 2020 as the leader in network  performance  and capacity. The company also has one of the premier entertainment companies in the world, with scaled production capabilities for both TV and theatrical  content  and vast, unmatched  intellectual  property libraries. And on May 27, 2020, the company brought all these critical elements together in a whole new  way with  the launch of HBO Max. HBO Max will allow the company to bring together WarnerMedia’s premium content, AT&T’s products and services, and Xandr’s robust insights to give our customers a  premium  streaming experience. Xandr’s data insights will help keep advertising relevant for viewers and effective for advertisers.

5   Includes   more   than  8  million    U.S.  business   customer   locations   on  or within    1,000 feet of  our  fiber. 6 Represents cumulative 170 million video-capable consumer relationships across the following: postpaid and prepaid wireless; TV and video offerings, including  HBO Digital  (HBO NOW® and over-the-top) and AT&T  TV NOW; Mexico wireless;  and U.S. consumer  broadband,  as well  as more  than  200 million  unique visitors to digital properties, including CNN Digital, Otter Media and Bleacher Report.

Supply chain

AT&T is committed  to conducting  business  with  the highest  ethical  standards  and integrity,  with  an emphasis on corporate responsibility and sustainability. The company’s suppliers are held accountable to the same high ethical, environmental, social and governance standards.

Suppliers are a key part of AT & T’s business and therefore must be part of the approach to sustainability and diversity. The  company  has  suppliers  around  the  world  (in  non-embargoed  countries) representing  all  types of trades, engaged across all our operating units. AT&T Communications works  with  more  than  20,000  suppliers around the world. The reach of the supply chain allows AT&T the opportunity  to  streamline operations, reduce long-term costs and limit overall environment impact.

The company continues proactive  work  with  the  suppliers  to  advance  sustainable  business  practices throughout our supply chain, focusing on energy  use,  climate  impact,  human  rights,  water  use,  waste,  and natural resource use. AT&T is committed to promoting healthy, safe, and inclusive working conditio ns throughout our supply chain.

AT&T also works to increase the participation of minority-, woman-,  veteran-,  LGBTQ+-  and  disabilit y- owned business enterprises in  the  supply  chain.  The  company  also  encourages  subcontracting  opportunities for these businesses by requiring supplier diversity participation from their prime suppliers.

The supply chain of AT&T Communications and AT&T Latin America, 2 of our  operating companies, is managed by the Global Connections and  Supply  Chain  (GCSC)  organization, representing  the  largest  and most complex portion of our supply chain. Because of the scale of this work, this issue brief reflects efforts of GCSC, unless otherwise noted. In 2019, GCSC centralized the management of high-risk suppliers representing certain high-risk factors and optimized reverse logistics strategy and operations.

Managing the Supply Chain

Top managerial responsibility for supply chain management lies  with  the Executive  Vice  President  of GCSC, who also sits on the Corporate Social Responsibility  Governance Council ("Council"). The Council is led by our Chief Sustainability Officer,  with  oversight  from  the  Public  Policy  and Corporate  Reputation  Committee of the AT&T Board of Directors.

The company’s supply  chain  management  strategy  includes  incorporating  Citizenship  and  Sustainability  as well as Supplier Diversity clauses into agreements and RFPs, training sourcing managers on the principles of sustainability and diversity  and  providing  updates   to  sourcing  managers  on  supplier  sustainability  and diversity performance. The company strives to ensure conformance with the AT&T Principles of Conduct for Suppliers ("Supplier Principles") using the following approaches:

• The Supplier Principles are posted on the AT&T Supplier Portal and are publicly accessible to all AT&T suppliers as well as any potential future suppliers. The company’s Supplier  Principles  and  manage ment systems are also applicable to non-tier 1 suppliers.
• The company’s general agreements  and  purchase  order terms  includes  Citizenship  and  Sustainability  as well as Diversity clauses.
• The company also conducts Strategic Supplier Sustainability Assessments and corporate social

responsibility (CSR) audits and assessments. The company’s CSR audit and assessment program  are conducted through their membership in the Joint Audit Cooperation (JAC) and applies to tier 1, 2 and 3 suppliers.

• The company also started implementing a Preferred Supplier Program in 2019 to recognize suppliers that demonstrate a commitment to all aspects of corporate social responsibility in the areas of diversity and sustainability.

Strategic challenges

Continuing growth in and the converging nature of wireless, video, and broadband services will  require the company to deploy significant amounts of capital and require ongoing access to spectrum to provide attractive services to customers.

Wireless, video, and broadband services are undergoing rapid and significant technological changes and a dramatic increase in usage the demand for faster and seamless usage of video and data across mobile and fixed devices.

The company must continually  invest  in  our networks  to improve  our wireless,  video,  and broadband  services to meet this increasing demand and remain competitive. Improvements  in  these  services depend  on many factors, including continued access to and deployment of adequate spectrum and the capital needed to expand our wireline network to support transport of these services. To stem broadband subscriber losses to cable competitors in our non-fiber wireline areas, we have been expanding our all-fiber wireline network. We must maintain and expand our network capacity  and  coverage  for transport  of video,  data and  voice  between cell and fixed landline sites. To this end, we have participated  in spectrum  auctions  and continue  to deploy software and other technology advancements to efficiently invest in our network.

Network service enhancements  and product  launches  may  not occur  as scheduled  or at the  cost expected  due to many factors, including delays in determining equipment and wireless handset operating standards, supplier delays, software issues, increases in network and handset component costs, regulatory permitting  delays  for tower sites or enhancements, or labor-related delays. Deployment of new technology  also may  adversely  affect the performance of the network for existing services. If the company  cannot  acquire needed  spectrum  or deploy the services customers desire on a timely basis with acceptable quality and at adequate cost, then the company’s ability to attract and retain customers, and, therefore, maintain and improve  the  operating  margins, could be materially adversely affected.

Increasing competition for wireless customers could materially  adversely affect our operating  results. The company has multiple wireless competitors in each of their service areas and compete for customers based principally on service/device  offerings,  price,  network  quality,  coverage  area  and  customer  service.  In addition, the  company  are  facing  growing  competition  from  providers  offering  services  using  advanced wireless technologies and IP-based networks. The company anticipates market  saturation  to continue  to cause the wireless  industry’s  customer  growth  rate to moderate  in  comparison  with  historical  growth  rates,  leading to increased competition for customers. The company also expect that their customers’ growing demand for highspeed video and data services will place constraints  on  our  network  capacity.  These  competition and capacity constraints will continue to put pressure on pricing and margins as companies compete for potential customers. The company’s ability to respond will depend, among other things, on continued improvement  in network quality and customer service as well as effective marketing of attractive products and services.  These efforts   will    involvesignificantexpenses   and   require    strategic   managementdecisionson, and timely implementation of, equipment choices, network deployment and service offerings.

Ongoing changes in the television industry and consumer viewing patterns could materially adversely affect our operating results.

The company’s video subsidiaries derive  substantial  revenues  and  profits  from  cable  networks  and premium pay television services and the production and licensing of television programming to broadcast and cable networks and premium pay television services.  The  U.S. television  industry  is  continuing  to evolve  rapidly,  with developments in technology leading to new methods for the distribution of video content and changes  in when, where and how audiences consume video content. These  changes  have  led  to  (1) new,  internet-based OTT competitors, which are increasing in number and some of which have  significant and  growing subscriber/user bases, and (2) reduced viewers of traditional advertising-supported  television resulting from increased  video  consumption  through  SVOD services, time-shifted viewing  of television  programming  and  the  use  of DVRs  to skip  advertisements.   The  number   of subscribers  to traditional   linear   programming  in the