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CWA: AT&T Breakup Raises Serious Concerns for Workers, Consumers, Longterm Investors
Washington, D.C. - The Communications Workers of America expressed concern about today's announcement by AT&T that it will split the company into four separate operations. AT&T has operational problems which cannot be fixed with financial restructuring, CWA said.
Further, the company is jeopardizing network reliability with its plan to cut some 1,000 jobs - the technicians and support workers who maintain the network for business and consumer services - announced last Friday. This could result in reduced service to key business customers, according to union officials.
"Customers will lose out, because increasingly, they will not be able to rely on the quality of the network. But AT&T also loses, because the skilled technicians it needs to keep the network secure will be let go to work for the company's competitors," said Jim Irvine, CWA vice president for communications and technologies.
"By cutting up the company, AT&T is going in exactly the opposite direction of every major telecom company. This plan doesn't make good business sense, particularly if the company's intent is to provide the integrated service that customers want," Irvine said.
The decision to break up the company into four parts - broadband, wireless, business and consumer services - indicates that AT&T is moving away from its strategy of bundling communications services, the "one-stop shopping" that both business and residential consumers want, the union said.
AT&T never really put its bundling strategy in place, CWA pointed out, because it failed to integrate operations in business services. The company kept marketing and customer service operations separate and made cutbacks in customer service that resulted in the loss of key accounts, the union noted. On the consumer side, AT&T has scaled back efforts to gain new customers, reducing the number of trained, skilled employees while relying on low wage telemarketing contract workers instead. AT&T didn't try to grow revenues, CWA said.
The union expressed concern that AT&T Broadband has not stepped up to AT&T quality standards, relying for the most part on a low wage, high turnover workforce. The union also noted that contentious labor relations at AT&T Broadband are not conducive to the kind of teamwork necessary to make AT&T a successful company.
CWA's concerns are shared by a number of investment and telecommunications analysts. The union said it will continue to raise questions about the breakup, its impact on consumers and workers, and the company's plans for the future.
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Further, the company is jeopardizing network reliability with its plan to cut some 1,000 jobs - the technicians and support workers who maintain the network for business and consumer services - announced last Friday. This could result in reduced service to key business customers, according to union officials.
"Customers will lose out, because increasingly, they will not be able to rely on the quality of the network. But AT&T also loses, because the skilled technicians it needs to keep the network secure will be let go to work for the company's competitors," said Jim Irvine, CWA vice president for communications and technologies.
"By cutting up the company, AT&T is going in exactly the opposite direction of every major telecom company. This plan doesn't make good business sense, particularly if the company's intent is to provide the integrated service that customers want," Irvine said.
The decision to break up the company into four parts - broadband, wireless, business and consumer services - indicates that AT&T is moving away from its strategy of bundling communications services, the "one-stop shopping" that both business and residential consumers want, the union said.
AT&T never really put its bundling strategy in place, CWA pointed out, because it failed to integrate operations in business services. The company kept marketing and customer service operations separate and made cutbacks in customer service that resulted in the loss of key accounts, the union noted. On the consumer side, AT&T has scaled back efforts to gain new customers, reducing the number of trained, skilled employees while relying on low wage telemarketing contract workers instead. AT&T didn't try to grow revenues, CWA said.
The union expressed concern that AT&T Broadband has not stepped up to AT&T quality standards, relying for the most part on a low wage, high turnover workforce. The union also noted that contentious labor relations at AT&T Broadband are not conducive to the kind of teamwork necessary to make AT&T a successful company.
CWA's concerns are shared by a number of investment and telecommunications analysts. The union said it will continue to raise questions about the breakup, its impact on consumers and workers, and the company's plans for the future.
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