AT&T Wireless Services Inc. President Steve Hooper and Vice Chairman Wayne Perry resigned last week, but the duo will remain kissing cousins with the old regime through a new venture into the local exchange business.
Hooper and Perry will lead OneComm L.L.C., a start up designed to enter the local loop. Hooper is OneComm’s president and Perry will serve as chairman. Gerry Salemme, formerly vice president of federal government affairs for AT&T, will join OneComm as executive vice president of government and industry relations.
Dan Hesse, formerly AT&T Corp.’s vice president and general manager of business development, takes Hooper’s place. The new positions are effective today.
While AT&T is the behemoth of telecom, and OneComm is a small startup, the two entities share a vision for local service, said Hooper. “We both want to foster local competition in the marketplace.”
Independent of the medium or method, be it distribution through resale, or building networks using fiber, point-to-point, broadband wireless or wireless local loop technologies, AT&T and OneComm want to provide customers untethered service at reasonable rates under the AT&T name, explained Perry.
“Wayne and I talked about four or five months ago, then presented (the OneComm idea) to (AT&T) people in New Jersey,” said Hooper.
OneComm holds letters of intent with AT&T that entail an ongoing relationship between the companies. Specifics of their alliance have not been drawn, but the rough game plan is for OneComm to enter small- and medium-sized markets that are a low priority for AT&T today.
From “the outside, we have the ability to focus on markets AT&T couldn’t get to, that they could or would not want to do on their balance sheet,” said Hooper. The partners already have a running list of target markets, and it’s a long one, added Hooper.
OneComm’s initial role will be strategic, working in conjunction with Nextlink. Started by Craig McCaw three years ago, Nextlink is a competitive local exchange carrier operating or ready to build in 21 markets across the country, said Bob Ratliffe, spokesman for Nextlink and other McCaw ventures.
“Our job is to help them grow more quickly, offering operational guidance. We’ve been through what it’s like to grow a big company and we made a lot of mistakes,” said Hooper. “What we gained in our experience (at AT&T) is a real appreciation for capital markets and the ability to work with partners and structure deals that are very creative and somewhat complex.”
OneComm will focus on business strategy and forming alliances with capital resources, vendors, technology providers, CLECs and others, Nextlink will continue in a functional role as local exchange carrier, actually building and operating networks, said Ratliffe. “Bringing the team together to focus on CLECs is a focus of Nextlink.”
The companies will remain based in the Seattle area.
McCaw will serve OneComm in an advising role. He is chairman of Nextlink and “his ownership will be contributed into OneComm,” said Ratliffe.
“We were the implementers of his vision,” said Hooper of McCaw, referring to his years at McCaw Cellular Communications Inc., which was purchased by AT&T in 1994. “We challenged it sometimes, but he was more right than wrong.”
There is all likelihood services launched by or affiliated with OneComm will be branded with the AT&T name.
“AT&T wants branded service, whether they do it or we provide the connectivity,” added Perry. “The customer wants to see AT&T … BT and MCI see it the same way. They all have to get their name in the marketplace.”
But AT&T will not be OneComm’s sole partner or client, though it may prove more than enough business for OneComm, added Hooper.
Hooper and Hesse alike talk of implementing untethered service in all corners of the country.
“The challenge in this role is to truly integrate from customers’ point of view the technical capabilities to truly have flexible seamless service,” said Hesse. “Wired or wireless doesn’t make a difference. We’re just adding capability and freedom.”
“They’re thinking about providing local-type services in many of the same ways,” added Todd Wolfenbarger, corporate spokesman for AT&T Wireless.
Hesse, a 20-year veteran of AT&T, has been working the past four months developing the plans for entering the local services market, dubbed the “any distance” strategy. “I’ve spent time (in Washington) because the role that wireless plays in AT&T’s plans. I am extraordinarily impressed with how well they know their business.”
Hesse’s appointment is illustrative of AT&T’s level of control with AT&T Wireless, said Mark Lowenstein, director mobile/wireless communications for the Yankee Group.
Hesse kicked off AT&T’s Internet access business, WorldNet, in March 1996. By fourth quarter last year, AT&T WorldNet became the largest Internet service provider in the United States with about 1 million customers, said Hesse.
In 1991, Hesse became president and CEO of AT&T Network Systems International, now part of Lucent Technologies Inc.
The OneComm name may sound familiar, previously the name of a Colorado-based specialized mobile radio operation. A few years ago, Nextel Communications Inc. purchased and integrated OneComm into the company. Through that acquisition, McCaw gained rights to the name.
