AT&T Inc. (NYSE:T), the once-monopolist of the telecom arena that seems to have reformed, today showed strong profit and revenue growth thanks to its purchase last year of BellSouth. Keeping the growth going, though, will be difficult.
AT&T's fortunes has been rising fast with the BellSouth merger now completed (after some serious anti-competitive regulatory scares at the start of this year). It reported quarterly profit of $2.8 billion on revenue of $28.97 billion.
The company is taking a more aggressive stance on the "integrated telecom" approach that gives customers a "one-stop shop" to buy virtually all telecommunications services. Unfortunately, the company's competitors are doing the same thing.
Time Warner Cable Inc. (NYSE: TWC), Comcast Corp. (NASDAQ: CMCSA) and Sprint Nextel Corp. (NYSE: S) offer everything from TV to wireless Internet to home telephone service. All these players want to offer everything to the customer and gorge on that big, fat integrated bill.
AT&T's acquisition of the old Cingular Wireless business with the BellSouth merger makes the company the largest wireless carrier in the U.S., where much of AT&T's profit growth is now coming from. On that note, heated competition from Verizon Wireless has not gone away.
Investors will closely watch AT&T's prowess this year in increasing margins from non-wireless businesses.
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