Ex-AT&T chair and CEO to lead GM

Your name is Edward Whitacre, Jr. As chairman of SBC you helped overseeone of the biggest communications resuscitations in history when yourcompany merged with AT&T in 2005, thereby virtually erasing thebreak-up of the giant phone company in the 1980s. A piece of cakecompared to what will be your new job: Chairman of a greatly shrunkenGeneral Motors. Question: Why did you say yes?

Inthe 1990s, information technology exploded. It wasn't hard so see, sostaying in the communications business was an easy choice. OK, it wasrelatively easy to piece AT&T back together again thanks to afew helpful regulatory rulings, and today — two years after you left– the telco is solidly in the black. It scored US$12.9 billion inincome last year, up seven per cent from 2007. At GM will you ever seethose numbers?

There are some similarities between the twocompanies. At AT&T, wireline revenues have been declining assubscribers jumped to VoIP and wireless competitors. GM has to dealwith buyers jumping to Asian competitors. But companies have to dealwith bloated middle management. But at GM the challenges areformidable. There's no magic technology the car maker can latch on to,as AT&T did with wireless and the iPhone. Wireless is the giftthat keeps on giving — the more it's used, the more revenue theservice provider pulls in. The auto industry doesn't have a parallel.People want a low maintenance vehicle that lasts at least five years, aprobably more. Then there's that stubborn union, those annoying pensionobligations and oil prices you can't control.

Sure being GMchair is a great challenge, and besides, the CEO will do most of thework. The U.S. and Canadian governments are throwing money at you, andthe courts will help you chop dealers and suppliers. But unlikeAT&T, it'll be an uphill struggle all the way. Why take thejob? Well, forgive the pun but perhaps Whitacre believes there's no funin taking the easy road (although when he left AT&T he madesure he was well taken care of). The auto andtelecommunications industries do have one thing in common: It's afree-for-all, with competitors coming at you from all directions.Dealing with that may be the expertise Whitacre brings.

Apparently, Whitacre left a simple message for his successor at AT&T: “Give'em hell.” The men at the top of GM will have to do that and more tosurvive.

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