AT&T Wireless Self-Destructs

The Second Crash

The Odyssey team was still struggling to get the Siebel system up and keep it up when, on November 24, customers began trying to port their numbers between carriers. That's when the software for handling number portability crashed.

TSI and NeuStar had arrived at "differing interpretations" of the industry's data standard for exchanging and verifying porting requests, known as Wireless Intercarrier Communications Interface Specifications (WICIS). The Yankee Group's Entner says that TSI modified its version of the WICIS standard without telling NeuStar. "They made changes in fields and reporting that didn't impact all their five customers but no longer made it possible to communicate with [NeuStar]," says Entner. TSI's Michael O'Brien, vice president of marketing, denies that changes were made without telling NeuStar but acknowledges that the two vendors had different interpretations of WICIS. (NeuStar declined to be interviewed for this story.) AT&T Wireless says that TSI crashes prior to the deadline prevented NeuStar from being able to test the process adequately, and on November 24, the electronic flow of porting requests between NeuStar and TSI broke down right away.

The industry had estimated that automated ports would require 2.5 hours to complete, so the porting messages were programmed with time and date limits. If the other carrier's system didn't respond within the allotted time, the port that failed was supposed to drop into an electronic bin to be handled manually.

NeuStar's software could not respond to TSI's systems before time ran out. And the error messages weren't all getting through either. When AT&T Wireless's Porting Administration Group tried to track and resolve errors using a workflow management tool, it crashed or froze. That meant AT&T Wireless customer service representatives were in the dark when their phones lit up. Combined with their continued problems accessing Siebel, there was little they could do to help their customers. In that first week of porting, more than half of the complaints filed with the FCC singled out AT&T Wireless, according to The Associated Press. The FCC sent a letter to AT&T Wireless on December 4, asking for an explanation, triggering a torrent of bad publicity.

"There were 50,000 [AT&T] customers per week that didn't have service because of this," says Phil Cusick, a telecom industry analyst with Bear Stearns. And many of them, like independent consultant Ian Drake, didn't stick around for a fix. After three weeks of trying to track his newly purchased AT&T Wireless phone, Drake gave up and signed on with Verizon.

A Company Fire sale

As word of AT&T Wireless's difficulties spread, customers began deserting at a rapid clip. The problems continued through December, according to AT&T Wireless president and CEO Zeglis. "It took most of December to expand the systems capacity so that the care reps could have as much access as they needed in order to handle customer calls at the same time the salespeople were processing new orders," he said in a conference call with analysts on January 22. "Frankly, our customer service went pretty far south."

For independent mobile phone retailers, which account for about 60 percent of new sales in the industry, there was no choice. "The indirect sellers pushed other brands when they heard that AT&T was having problems," says Greg Teets, telecom analyst for AG Edwards. AT&T Wireless was forced to bump up commissions to independents and lower prices to try to stem the tide. It didn't work. After adding 229,000 customers in the third quarter of 2003, fifth out of the top six providers, AT&T Wireless added just 128,000 in the fourth quarter, last among the top providers and less than one-tenth the number of industry leader Verizon, which added 1.5 million new subscribers.

By January, AT&T Wireless was in the advanced stages of plans to move overseas more than 3000 positions in its computer operations and customer service, according to The Wall Street Journal. (It backed off from the plan only after agreeing to be purchased.) Some employees became part of AT&T Wireless's "buddy program", in which consultants from Indian outsourcing companies Tata Consultancy Services and Wipro were assigned to AT&T Wireless employees to learn their jobs.

In February, 220 AT&T Wireless IT employees were told that they would be released from the company in March. According to one of the terminated employees, another round of 250 lay-offs is planned for June and the same number for September. "It's tough," an employee said in February. The Indian workers "basically follow people around all day and pepper them with questions". Other former employees say some staffers resisted helping the consultants. "People would make project decisions when the Indians weren't around," a former employee says.

On February 17, Cingular announced that it was buying AT&T Wireless.

That same day, Deborah Sawyer's voice-mail box began filling up with messages. Sawyer, a partner for executive search firm Morgan Howard Worldwide, says she received enquiries from 12 different AT&T Wireless IT executives looking to move on.

But for their company, the odyssey was over.

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