Ex-AT&T chair and CEO to lead GM

Your name is Edward Whitacre, Jr. As chairman of SBC you helped oversee one of the biggest communications resuscitations in history when your company merged with AT&T in 2005, thereby virtually erasing the break-up of the giant phone company in the 1980s. A piece of cake compared to what will be your new job: Chairman of a greatly shrunken General Motors. Question: Why did you say yes? In the 1990s, information technology exploded. It wasn't hard so see, so staying in the communications business was an easy choice. OK, it was relatively easy to piece AT&T back together again thanks to a few helpful regulatory rulings, and today — two years after you left — the telco is solidly in the black. It scored US$12.9 billion in income last year, up seven per cent from 2007. At GM will you ever see those numbers? There are some similarities between the two companies. At AT&T, wireline revenues have been declining as subscribers jumped to VoIP and wireless competitors. GM has to deal with buyers jumping to Asian competitors. But companies have to deal with bloated middle management. But at GM the challenges are formidable. There's no magic technology the car maker can latch on to, as AT&T did with wireless and the iPhone. Wireless is the gift that keeps on giving — the more it's used, the more revenue the service provider pulls in. The auto industry doesn't have a parallel. People want a low maintenance vehicle that lasts at least five years, a probably more. Then there's that stubborn union, those annoying pension obligations and oil prices you can't control. Sure being GM chair is a great challenge, and besides, the CEO will do most of the work. The U.S. and Canadian governments are throwing money at you, and the courts will help you chop dealers and suppliers. But unlike AT&T, it'll be an uphill struggle all the way. Why take the job? Well, forgive the pun but perhaps Whitacre believes there's no fun in taking the easy road (although when he left AT&T he made sure he was well taken care of). The auto and telecommunications industries do have one thing in common: It's a free-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 to survive.

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