AT&T's Whitacre Cedes Throne
Edward Whitacre, chairman and chief executive of AT&T Inc. (NYSE: T) announced at a shareholders meeting this morning that he will be retiring on June 3. Chief operating officer Randall Stephenson will take his place.
While the announcement came as a surprise, considering Whitacre had a year left on his contract, investors seem to be confident in Stephenson's abilities as a replacement. The stock was trading down just 22 cents (0.6%) at $38.74 midday today.
Whitacre had been largely regarded as one of telecom's best CEOs and was the main architect of the new AT&T, now the largest telco in the United States. As head of the former regional bell operator SBC Communications, he spearheaded several key acquisitions including Pacific Telesis, Ameritech, the old AT&T, and most recently BellSouth. (San Francisco Giants fans can explain it best.)
Whitacre is also largely responsible for the decision to go with a fiber-to-the-node architecture – as opposed to fiber-to-the-premises – for the U-verse video service. (See AT&T: We're Sticking With FTTN.)
He leaves behind an AT&T that almost resembles the size of its 1984 version. (See SBC to Buy AT&T for $16B and Ma Bell Is Back!) His acquisition spree has resulted in the company's stock rising by nearly 50 percent in the last 12 months.
In building from the foundation that Whitacre created, Stephenson's biggest challenge will be the competition for customers with cable companies, especially if it turns out that the bandwidth needs of the future exceed the bandwidth capabilities of the FTTN network
Stephenson has been with the organization since 1982 in various high level roles, mainly on the financial side of the business. "Randall Stephenson is an exceptional leader. He has a deep understanding of this business and a clear sense of where it should go," Whitacre said in a statement.
Whitacre will leave with a handsome retirement package worth a reported $158.5 million. He was among the highest paid executives in the world, with a total compensation of $36 million last year.
— Raymond McConville, Reporter, Light Reading