Concert - Company Business and Marketing

Telecommunications, March, 2001 by Sanjima Dezoysa

Just six months ago, Concert, the joint venture company between AT&T J and BT, faced claims that AT&T's and BT's domestic problems might overshadow its development. According to Mark Bruneau, chief executive of Renaissance Strategy, a consulting firm that has worked for all three companies, Concert was 'suffering from parental abuse'. However, he also went on to comment that if the companies could resolve internal disputes, Concert could dominate the market.

Nevertheless, from the financial data available, Concert appears to be struggling with a sharp decline in operating profits ([pound]60 m)[epsilon]92 m in the first quarter 200.1 to ([pound]2 m/[epsilon]3 m in the third quarter).

Although its board of directors is made up of representatives from AT&T and BT, Concert has its own leadership team at executive management level. In day-to-day operations Concert is a separate company -- not a subsidiary to either AT&T or BT.

Concert aims to serve the needs of multinational companies, traditional and emerging carriers, wholesalers and ISPs. Niall Hickey, Concert's communications manager claims that both AT&T and BT have previously tried to provide global services to multinational customers on their own and realised their individual size and strength was not enough. "Obviously AT&T has a strong position in the US which is a key market for serving multinational customers, and by joining with BT this really extended its global reach into Europe and Asia."

New look

Apart from global reach, Concert is also fundamentally different in its market role from earlier alliances which AT&T and BT had embarked on -- World Partners and Concert (but with WorldGom) respectively. "Both were loose alliances in many ways and while they were trying to provide a set of seamless global services, they were essentially product-houses relying on distributors to sell the products," claims Hickey.

The main difference between present-day Concert and these alliances is that AT&T and BT have incorporated more of their international assets, including distribution channels. Hickey continues: "Concert's whole brand proposition is that we try and make life simple for customers, and allow customers to reach their maximum potential and take their business as far as they can."

Global accounts and services

Concert's portfolio of services includes global accounts and global services. Global accounts provides global sales support from a single account team to 260 multinational customers, previously served by AT&T or BT. They are now completely managed by Concert -- it owns the customer relationship and the profit and loss account. Hickey continues: "This has been a very brave decision for the parent companies to make -- essentially carving out part of their revenue and business and creating a new separate joint venture company." Global accounts include a wide range of companies such as Texaco and Nissan.

Global services develops and manages the Concert portfolio of retail services sold by global accounts, AT&T, BT, and alliance distributors. Concert has over 50 distributors around the world, including Viag in Germany and StarHub in Singapore, with AT&T and BT obviously being the two largest distributors.

In addition, global services manages responsibilities for international traffic management. Concert carries traffic for AT&T and BT as well as 400 other carriers around the world, and last year carried a total of 28 billion minutes of voice traffic on its networks.

IP portfolio

Concert is investing US$5 bn ([epsilon]5.5 bn) in IP network development over the next three years. "Concert is very IP-orientated as a company because that is where we see the future of the industry moving," claims Hickey. Concert launched a new, expanded portfolio of IP-based and wireless services for global business and wholesale customers in July last year.

The IP portfolio is part of Concert's 'continuing progress in helping business customers migrate their networks and/or operations into IP and e-commerce environment while also delivering integrated and global services'. The campaign theme linked to the IP launch was 'taking business to the nth degree' which Hickey explains signifies 'unlimited possibilities'.

Currently, 80 per cent of the traffic carried on Concert's data networks is IP traffic. "Concert is really focusing all its energies on IP services -- IP is at the heart of Concert's business," affirms Hickey.

Network reach

Concert's network reach incorporates AT&T and BT's trans-border infrastructure giving it a distinct advantage over other global service providers. The IP network -- capable of transporting data at 2.5Gbps -- is connected with AT&T's and BT's domestic backbones, reaching in excess of 800 POPs (points of presence) in the US and Europe.

Hickey explains: "If a BT customer in the UK makes an international call, BT carries that call up to cable stations and satellite earth-stations. But as soon as that call leaves the UK, it moves to Concert's network." Concert has an infrastructure of 30,000 miles of undersea cable which reaches 90 per cent of the world's leading business markets.