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10/2/2007
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AT&T's Interwise Buy Could Be Its Ticket To Unified Communications

The acquisition gives AT&T a strong portfolio of voice, Web, and videoconferencing services to compete with Cisco and Microsoft.

AT&T's planned acquisition of conferencing provider Interwise is expected to improve the carrier's IP networking offerings for business customers and may help it compete in the unified communications space with Cisco and Microsoft.

AT&T this week said it will acquire Interwise for $121 million in cash -- a move that gives AT&T a strong portfolio of voice, Web, and videoconferencing services. Interwise will be operated as a business unit of AT&T's enterprise division, led by Ronald Spears.

AT&T currently offers enterprise networking, communications, and collaboration services, as well as a conferencing portfolio of services. The carrier operates an IP network based on Multiprotocol Label Switching (MPLS), a technology that improves the speed of packet processing and enhances performance of the network.

Together with Interwise, AT&T plans to more quickly develop and bring to market capabilities to address the evolving collaboration needs of businesses, said an AT&T spokesman. These capabilities include integrated voice, Web, and video services, delivered by a single vendor.

The spokesman said it's too soon to discuss specific products since the transaction is expected to close in the fourth quarter of this year, but Interwise's platform will likely be used by AT&T to bolster its unified communications offerings.

Unified communications is an emerging technology that links business processes with presence information, e-mail, voice mail, instant messaging, and videoconferencing to facilitate efficient communications.

"I suspect AT&T will join the ever growing number of [unified communications] vendors and will center their solution around conferencing," said Zeus Kerravala, an analyst at Yankee Group. "Cisco has WebEx. Microsoft has LiveMeeting. AT&T will have Interwise and it's a good move for AT&T."

If AT&T can deliver an integrated unified communications product, it will succeed in an area where most telecom carriers have lagged. "They bought their way in," Kerravala said, "so their success will depend on what they do with the technology from here."

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