• by Joe Mandese , January 2, 2007

AT&T, the telecommunications company once synonymous with a subscription revenue model, plans to adopt advertising as the cornerstone of an aggressive push into new wireless services, Chairman-CEO Edward Whitacre Jr. says in an interview in today's Wall Street Journal. The plan, which would include selling mobile advertising on cell phones, as well as ads on AT&T television and broadband Internet services, is projected to generate "several billion dollars" in advertising revenues per year within the next five years, and comes as other big telecommunications players such as Sprint Nextel and Verizon are also aggressively pursuing the advertising marketplace.

The moves come after AT&T completes its $86 billion acquisition of BellSouth Corp., and full control of wireless phone service operator Cingular, making it the largest U.S. telecommunications firm.

AT&T has quietly been amassing an advertising sales force and has already begun briefing Madison Avenue on its plans to develop new advertising services based on its so-called U-Verse package, a mixture of telephone, Internet and television services aimed at its base of 58.7 million wireless and 67.5 million land-line phone customers (Media Daily News Sept. 29, 2006).

"The biggest asset we bought here was Cingular. We're about to become a company with wireless at its heart," Whitacre told the Wall Street Journal, adding that AT&T would begin selling advertising on cell phones, TV and Internet services this year.

Whitacre said AT&T also is testing a myriad of new mobile services including methods for running cell phones via Wi-Fi networks at home.