AT&T attracts 200 customers to its Network on Demand service

AT&T (NYSE: T) is finding that Network on Demand services are resonating in the marketplace as it now has over 200 customers worldwide.

Although these new services will cannibalize its legacy T-1 and ATM data service revenue base, AT&T said during its recent analyst meeting in Dallas that its new on-demand services are not only gaining fast market traction, but customers are willing to pay a premium for such services.

"Customers are willing to pay more for unique, value-added services [NetBond and Network on Demand], and are not expecting a discount," said Randall Stephenson, AT&T chairman and CEO, during the analyst event.

One of the flagship products in the on-demand portfolio is its on-demand Ethernet service.

Already available in over 170 markets, AT&T plans to expand the service out of its territory in the near future. Using a software-defined networking (SDN) construct, the "AT&T Network on Demand" capability is being deployed as part of its User Defined Network Cloud (UDNC) strategy it launched in February.

Perhaps not surprisingly, the focus of the on-demand Ethernet service is focused on serving businesses in its fiber-ready buildings that it has been targeting through the fiber-to-the-building (FTTB) program within the Project VIP initiative. The service provider, which has set a goal to reach 1 million buildings with fiber by the end of this year, currently reaches 875,000.

Ethernet is only one part of its software-based network vision. The service provider also now offers Managed Internet Service with the Network on Demand capability, a virtualized business Internet service. This service virtualizes the edge router and customer router in its cloud, enabling new site implementations in days and reconfiguration in minutes.

Given the ambitious software transformation plans it has set, AT&T is in the midst of reorganizing its workforce. Earlier this year, the telco said that it was reorganizing nearly 130,000 people in its organization, including IT, network and operations staff, to focus on the new software effort.

Within this group of 130,000 employees, AT&T previously said that 2,000 engineers are focused on software defined networking (SDN) with thousands of others participating in the effort.  

Although the company maintains it would like to keep as much of its existing employee base intact, Technology Business Research says that the company will likely have to cut some employees from its roster.

"Despite this effort to retrain headcount, job cuts will remain inevitable as AT&T evolves, with tens of thousands of jobs potentially on the line on a net basis," said TBR in a report. "AT&T is augmenting its internal retraining strategy with hiring from the outside to bring in critical skill sets. Specifically, the operator noted it is aggressively seeking to fill specialized positions in software and analytics."

For more:
- TBR Newsroom article

Related articles:
AT&T to begin CORD field trials in wireline network in 2016, expand virtual services
AT&T Donovan: We'll virtualize more FTTP hardware functions in 2016
AT&T, ONOS Project unveil SDN/NFV solution for central office, home and business locations
AT&T shifts 130K employees to focus on software networking transition
AT&T's Fuetsch: Apple's iOS software updates 'biggest event we worry about' on network

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