(Adds analyst comments, background, details throughout)
By Marina Lopes
WASHINGTON, Aug 26 (Reuters) - AT&T Inc is merging its wireless and business divisions into a single unit led by Ralph de la Vega, former chief executive of the company’s wireless segment, a spokesman for AT&T said on Tuesday.
The announcement comes as cable companies try to lure business customers away from traditional telecommunications carriers. To become a more seamless competitor, AT&T has been combining its wireline and wireless operations, including customer care and network operations.
Glenn Lurie, who headed AT&T’s emerging enterprises and partnerships unit, has been promoted to chief executive officer of AT&T’s wireless segment, reporting to de la Vega, AT&T spokesman Brad Burns said in an email.
Business-related customers represent more than 50 percent of the company’s mobile revenues.
“They are simply making the case that the cornerstone of the enterprise sale is now wireless rather than wireline. It makes a ton of sense with the cable industry focusing more and more on the commercial segment,” said Craig Moffett, an analyst at MoffettNathanson.
Comcast has been steadily building out its Wi-Fi network and plans to have 8 million hot spots by the end of the year, covering 19 of the 30 largest U.S. cities. The No. 1 U.S. cable company is also seeking U.S. regulatory approval to buy Time Warner Cable Inc, which now has 34,000 Wi-Fi hot spots.
If the merger is approved, the combined company would have a national footprint that could potentially challenge the dominance of U.S. telecom companies Verizon Communications Inc and AT&T in offering cellular data and even voice services.
“The missing piece for cable is wireless and AT&T seems to be positioning itself to emphasize not only their strength, but cable’s weakness,” said Moffett.
Before taking on the combined wireless and business unit, de la Vega led AT&T Mobility for seven years. (Reporting by Marina Lopes. Editing by Andre Grenon)