AT&T chairman-CEO Randall Stephenson is routinely described in press profiles as “easy-going” and low-key. His Sooner State lilt gives him a folksy accent compared to media execs rooted on the coasts. But Stephenson made it clear in a conference call with investors Monday to sell the $67 billion DirecTV takeover that he is no rube when it comes to evaluating the future of a fast-changing media landscape.
“We think this is a very powerful combination,” he said, spelling out the plan to marry AT&T’s nationwide wireless networks with DirecTV’s national pay TV footprint. The combination of the assets and the executive brainpower that DirecTV brings to AT&T will enhance “the elegance and the beauty” of the “customer experience” AT&T can deliver across all manner of screens, he said.
Stephenson is a telco lifer who came up through the ranks of finance and marketing in an era when telephone services have seen exponential growth and change. Trained as a CPA, Stephenson joined the IT department of what was then one of AT&T’s “Baby Bells,” Southwestern Bell Telephone in Oklahoma City, in 1982. He moved on to posts in finance and corporate taxes, and by the early 1990s was overseeing finance for the Mexican operations of what by then had become SBC Communications.
By the time SBC bought a beaten-down AT&T in 2005 for $16 billion, Stephenson had gained experience in consumer marketing and exposure to the wireless revolution by serving as a director of Cingular Wireless and AT&T Mobility. He joined the board of AT&T following the SBC acquisition and was named CEO in 2007.
On Monday, Stephenson emphasized that AT&T has been taking major steps to expand its video capacity for years prior to pouncing on DirecTV, even though AT&T already bills itself as the “world’s largest telecommunications company” with $129 billion in revenue.
Indeed, in an interview with CNN after his promotion to CEO in 2007, Stephenson asserted: “IPTV is a multibillion revenue source for us.”
AT&T has a long regulatory road ahead before Stephenson will be able to make a meaningful mark on DirecTV. He sang the praises of the satcaster’s executive management team during the conference call, but it is clear that current CEO Michael White will step down once the deal is completed, giving Stephenson a chance to set the tone for the post-merger era with his choice of a leader.
In an interview last year with Leaders magazine, Stephenson further outlined his vision for why the telco giant needed to dive deeper into video — much more so than it has been able to do through its U-Verse service, which was handicapped by geographical limitations of AT&T’s wireline networks. Echoing sentiments he expressed during Monday’s call, Stephenson sees AT&T’s growing wireless platform as a springboard for new services. DirecTV and its showbiz connections will help accelerate those innovations — or so Stephenson hopes.
“Five years out, we believe the lion’s share of the traffic on our network will be driven by video. Specific services that will drive video consumption will include some that we bring to market, but the lion’s share will come from letting innovators create on top of our network infrastructure,” Stephenson told Leaders.
“We believe the best way to participate in innovation cycles is to open up our networks and turn the innovators loose, although we have an industry that has traditionally been averse to that. AT&T used to sell the telephone that was hardwired into the wall and that was the service you got. Then we opened up these networks and began to see innovation evolve and develop,” he said.
(Pictured: Randall Stephenson and then-New York City Mayor Michael Bloomberg in 2011 when AT&T announced the installation of free wifi hotspots in 20 city parks.)