AT&T to drive GM's billion dollar network

Published Date
22 - Feb - 2007
| Last Updated
22 - Feb - 2007
AT&T to drive GM's billion dollar network
Telco AT&T has sealed the deal of a lifetime, with American car maker General Motors agreeing to pay almost US$1 billion (AU$1.26 billion) for networking services over the next five years.

It is one of the largest commercial contracts in AT&T's history, the company said in a statement. GM operations in Australia and New Zealand will benefit from the agreement, an AT&T spokesperson said.

AT&T already runs GM's global virtual private network solution. The contract, which takes effect on July 2007, is a renewal and expansion of their existing alliance.

Under the new terms, AT&T will provide next-generation telecommunication solutions to the manufacturer. GM will also rely on the telco to manage relationships with key service providers across the globe.

In an effort to standardise operations around the world, a Multiprotocol Label Switching-based (MPLS) network will be in play, giving GM a single, streamlined Internet protocol-based communications platform.

"AT&T's networking expertise and global reach make it uniquely qualified to meet our needs," Ralph Szygenda, GM group vice president and chief information officer, said.

Meanwhile, in a recent interview with ZDNet Australia, AT&T's Australia/New Zealand managing director Jeyan Jeevaratnam claimed IP/MPLS-based networks were more efficient in the long term compared with legacy technologies (such as frame relay or ATM).

He attributed the increased ease of administration or greater "plug and play", and the ability to run multiple services such as voice and video alongside data as contributing factors.

AT&T to drive GM's billion dollar network: Jeyan Jeevaratnam
Jeyan Jeevaratnam

The US had initially held off jumping on the IP telephony technology bangdwagon, he said, but now had a change of heart. And Australia isn't far behind.

Most networking vendors are currently plugging a full stack of unified communications technology (including voice, video, instant message, and e-mail), but Jeevaratnam said enterprises were leaving the more advanced features for the future.

"I think people are looking for a long-term perspective that they want to have an infrastructure that can handle the messaging, and the unified communications and all that part.

"What they are implementing is I think purely a data network first, with IP capability, and then they're going to VoIP and testing that out, and they're really doing a step by step approach," Jeevaratnam said.

For example, Jeevaratnam said even though many companies had replaced their old analogue handsets with VoIP equivalents, most people weren't using the additional functionality on offer. Part of the problem was a lack of corporate IT resources.

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