AT&T Executive VP Ron Ponder May Be on His Way Out; Report Posted on InformationWeek Online at http://www.informationweek.com

PRNewswire
MANHASSET, N.Y.
Apr 25, 1997

Ron Ponder, Chief Information Officer (CIO) and Executive Vice President of AT&T (NYSE: T), is under intense cost-cutting pressure from company President and COO John Walter and may be on his way out, according to a report posted tonight on CMP's InformationWeek Online (http://www.informationweek.com/).

Walter wants Ponder to outsource much of the troubled company's information technology operations, sources close to AT&T told InformationWeek. Ponder is resisting the move, they add, because he believes it would undo his restructuring efforts of the last four years. "Ponder and Walter got into an intense debate over this," says a source close to AT&T who asserts Ponder is ready to resign over the matter.

AT&T has no comment beyond calling Ponder a "valuable member of the executive team." Ponder, vacationing in Florida, confirms that he and Walter have had "spirited debates."

Ponder, who is in charge of all information processing for AT&T, has already taken some losses. Earlier this year, Walter cut Ponder's direct reports from 70,000 people to about half that as part of a company-wide reorganization.

The latest dispute springs from Walter's stated goal of cutting $2.5 billion from AT&T's overhead. He recently asked Ponder to head a committee to explore cuts in information technology, possibly through outsourcing to AT&T Solutions, which runs a $750 million outsourcing business. Says Rick Roscitt, head of the AT&T Solutions' network outsourcing unit: "One of the options I've always had is to run the AT&T infrastructure."

Sources suggest AT&T Solutions might bring in IBM, EDS, or another outsourcer to help with the project. If that happens, the sources add, Walter could move Ponder to a new job within AT&T, or, more likely, Ponder would leave the company he joined in 1993.

While Roscitt stressed to InformationWeek Online that no decision has been made yet, he is advising top AT&T managers on outsourcing. "I think you'll find AT&T Solutions stepping into a bigger role there," Roscitt says. One thing that will never be outsourced, Roscitt adds, is AT&T's own networks -- his unit's core competency.

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-0- 04/25/97

SOURCE: CMP Media Inc.

CONTACT: Steve Rubel, 516-562-7434 or srubel@cmp.com, or Catherine Jarrat
Koatz, 516-562-7827 or ckoatz@cmp.com, both of CMP Corporate Communications