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AT&T Mulls European Expansion

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AT&T, Inc. (T) is seeking expansion plans in the European continent. The company plans to license Digital Life– a home monitoring system activated on wireless devices like cellphones. The company hopes to see more international businesses coming up for its Digital Life products. 

Besides conventional telecom services like voice and data, the company is making sound progress in the innovative and emerging products category, thereby accelerating revenue generation and enhancing profitability. In this regard, the company recently won the General Motors Company’s (GM) OnStar deal. Since 1996, Verizon Communications Inc. (VZ) has been the service provider for OnStar, which connects drivers to live operators for directions or help during emergencies. From 2015 onward, AT&T will provide wireless support to this service, which already boosts similar agreements with other automobile companies like Ford Motor Co. (F) and Nissan Motor Co.

AT&T – the largest provider of wireless services in North America – is experiencing strong momentum in its wireless businesses. Continued strength in smartphone and branded computing device sales are fueling growth in the wireless sector.

The company boasts the best Internet speeds in the industry as it is the only U.S. carrier that provides 4G networks through both Long Term Evolution (:LTE) and High-Speed Packet Access Plus (HSPA+) technologies.

The company’s LTE networks serve as the benchmark for mobile technology and the life-blood for operators across the world. The company is on track to deploy 4G Long-Term Evolution (:LTE) services as early as possible and achieve the target of connecting 250 million people by 2013-end and 300 million people by year-end 2014.

However, risk factors such as a saturated wireless market, persistent losses in access lines, labor union issues and aggressive pricing plans of direct competitors are likely to weigh on the company’s revenues and margins in the near to medium term.

AT&T has a Zacks Rank #3 (Hold) rating.

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