Growth By Acquisition Works for at&t


Growth by acquisition clearly has been working for at&t, which is probably why executives there will stay on course with the strategy. The company reported a whopping 61 percent increase in second-quarter profit after $140 billion in acquisitions almost doubled revenue. This is an old strategy many competitive local exchange carriers attempted in the early 2000s, largely without success. Of course, CLECs had different problems. Investors were pushing them to grow fast, and organic growth obviously wasn't going to work. There also were more providers than customers (that's a bit of an exaggeration, but not much of one).

It remains to be seen how well the contrasting Verizon and at&t strategies work out. Verizon essentially is betting its future on the superiority of its wired assets, while not neglecting its wireless assets. at&t arguably is investing in acquisitions that lean in the direction of wireless while economizing on its wireless upgrades.

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