Telecommunication
References Networking Case (First Item)
June 20, 1994
Customers will be able to expect the same knowledge, procedures and support levels regardless of their location,"; said Kathleen R. Flaherty, senior vice president of worldwide sales and marketing at Concert. Analysts said Concert, which will include a centralized network management center in Atlanta and a staff of 700 to 1,000, will do a better job of simplifying international communications than the spate of "marketing alliances" between carriers in the past.
"All the carriers rolled out 'one-stop shopping' [alliances], and theywere all dismal failures," said Ken McGee, a vice president at Gartner Group, Inc. in Stamford, Conn.
McGee added that the business opportunity for making international communications simpler is enormous. "The realities of international communications just make your hair hurt," he said.
BT and MCI said they intend to invest $1 billion in Concert in the next five years.
Concert will include Global Customer Support Centers in London; Paris; Sydney, Australia; Tokyo; and Cary, N.C. Each of the centers will offer multicurreney billing support and seven-day, 24-hour multilingual customer support. MCI and BT will act as distributors for Concert products and services, with MCI handling the domestic market and BT handling the international scene. They did not detail how Concert-based services would compare in price with services from other carriers, however. "We expect the economies of scale that derived from an integrated, heavily loaded network will. .drive price advantages," Flaherty said. On the other hand, the opportunities for pure network outsourcing could be significant. The alliance has been approved by UK and European regulators, and MCI shareholders passed the plan in March.
Sprint Corp. last week disclosed plans to sell a 20% stake for $4.2 billion to the French and German national carriers. The plan, which must be approved by regulators in the various countries, calls for a global network that is owned, planned and managed by the three partners. Sprint will own 50% of the alliance's backbone network, while Deutsche Telecom and France Telecom will split the other half. AT&T Corp. officials last week fired off an objection to the plan, arguing that the French and German telecommunications markets are closed to U.S. carriers. Approval of the plan would allow the three companies to leverage an estimated $155 billion in assets and more than $70 billion in revenue.