AT&T is selling its EasyLink services, network, and staff assets to Swift Telecommunications Inc. for an unspecified sum. The EasyLink line includes electronic data interchange, IP EDI, fax solutions, mail services, Web-to-fax services, and telex services. The sale comes just two months after the telco detailed plans to break into four companies.
"We're in the process of transforming our business so we can continue to compete and are evaluating services,'' says an AT&T spokeswoman, who would not say whether EasyLink services are profitable or are projected to grow at an acceptable rate. "We think it's better for specialty services like EDI and telex to be handled by companies that focus on these specific areas.''
The sale is part of AT&T's post-breakup strategy of selling certain assets to raise money, which is crucial because the company is carrying roughly $60 billion in debt, its stock is trading at low prices, and its credit rating was recently downgraded. "The real issue here is that the business needs to invest to go forward but has to first come up with the cash to do this,'' says Lisa Pierce, a program manager at Giga Information Group, who added that customers using EasyLink services may not be happy with the transition to Swift.
"EDI itself is still very popular, is a growing market, and is the No. 1 form of B-to-B commerce today,'' says Pierce. "There are many large companies using AT&T's EDI services that likely won't be happy about no longer dealing with AT&T and being treated like herded cattle. And then there's the concern that the transferred AT&T employees might choose to leave instead of joining the new company.''
"AT&T's goal is to support the smoothest possible transition ... as they move from AT&T to Swift,'' said Anne Chow, VP, managed applications services with AT&T's business services unit, in a statement. She did not say what the transition will entail or how many customers use the EasyLink services. The sale is expected to close early next year.