AT&T consolidates federal, state and local government operations, taps Kapoor to lead new group

Washington, D.C.
Having led AT&T's federal business for four years, Kay Kapoor is a logical fit to lead the new Public Sector group as its president.

AT&T is consolidating its federal, state and local public sector operations into one Global Public Sector organization and has named AT&T executive Kay Kapoor to oversee it.

Having led AT&T's federal business for four years, Kapoor is a logical fit to lead this new Public Sector group as its president.

"Our public sector and education customers are a top priority,” Kapoor said in a release. “By bringing all public sector teams together, we can improve the value and partnership we offer to these customers."

One of Kapoor’s key achievements at AT&T Federal is that she led AT&T's public-private partnership with the First Responder Network Authority (FirstNet), which was announced March 30.

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The Department of Commerce and FirstNet selected AT&T to build and manage the first broadband network dedicated to America's police, firefighters, EMS and other first responders.

AT&T was awarded the 25-year contract to provide a nationwide mobile broadband network for first responders in the U.S., beating out rival bidder Rivada Mercury, which recently lost an appeal over its exclusion from the tender. The FirstNet system will cover all 50 states, five U.S. territories and the District of Columbia, creating 10,000 jobs during the first two years and “tens of thousands” of jobs during the entire contract period.

But FirstNet is only one of AT&T Public Sector’s largest government contracts. The service provider is also a prime contractor on the General Services Administration’s (GSA) Networx Universal and Networx Enterprise.

According to the GSA, federal agencies purchased $1.79 billion in network and telecom services in FY 2016 (Oct. 2015-Sept. 2016) under the Networx contract.

Given their presence on the Networx contract, AT&T will also be in a prime position to have a large role in the Enterprise Infrastructure Solutions contract, the follow-on to Networx, WITS-3 and the local telecom services contracts.

Public sector is a large piece of AT&T’s business services revenue base.

AT&T’s Public Sector sales totaled nearly $15 billion in 2016. The organization provides advanced information and communications technology services to government and education customers across federal, state, local and international public sector markets.

Although AT&T does not specifically break out quarterly public sector numbers, the unit is a big contributor to business services revenues. AT&T’s total fourth-quarter business service revenues were $18 billion, down 1% versus the year-earlier quarter, but up 1.5% sequentially.

Like AT&T’s traditional enterprise customers, public sector agencies are also migrating from TDM to IP-based cloud and Ethernet services. During the fourth quarter, strategic business services rose 8.3% year-over-year and make up 38% of business wireline revenues in the fourth quarter. Total business wireline revenues were $7.7 billion, down 4.6% year over year.