AT&T Wireless pins hope on record

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Newly emancipated from parent AT&T Corp., AT&T Wireless believes it's found the ideal partner to help craft an image as the pre-eminent architect of the wireless future: a partner that's won plaudits for reviving IBM Corp. and recasting the American Express Co. brand, an agency with a deep bench and a sturdy network.

AT&T Wireless' selection of WPP Group's Ogilvy & Mather Worldwide, New York, to create the advertising for its $400 million account is momentous for all of these reasons and more. AT&T Wireless, which spun off on July 9, is looking to plot a new course in an inevitably chaotic future chastened by jittery capital markets and a stalled tech sector. Omnicom Group's TBWA/Chiat/ Day, Playa del Rey, Calif., was a finalist in the review. Interpublic Group of Cos.' Foote, Cone & Belding, New York, defended the account during a nearly four-month review process after its San Francisco office lost the business. The plum account was eagerly sought after in a decidedly gloomy year in the ad business.

"Overall, AT&T Wireless just developed a confidence that O&M would be a great member of the team to help us execute a lot of the work we have been doing to build toward being an independent company," said James Peterson, AT&T Wireless VP-corporate communications. Mr. Peterson cited Ogilvy's "strong strategic insight," understanding of wireless and "the scope and the scale" to build a brand. AT&T did not request creative proposals in the review. Mr. Peterson declined to assess other finalists' pitches.

The winner was overjoyed. "It is a terrific account and we are thrilled," said a nearly giddy Shelly Lazarus, Ogilvy chairman.

The victory could not come at a better time for WPP, whose year-to-date new-business record prior to the win was dead last among holding companies, according to a tally by Credit Suisse First Boston analyst David McMurry.

Though the AT&T Wireless spinoff and agency search are now finished, challenges are far from over. As the nation's No. 3 wireless service provider, AT&T Wireless is under pressure to stake out a leading role in creating next-generation wireless services.

"They can still use the AT&T Wireless name but come up with an entirely new campaign, something trendy, something futuristic ... what's available now and what's next generation," said Jeffrey Kagan, an independent telecommunications analyst.

"Somebody's got to set the agenda," he said, suggesting AT&T Wireless has the opportunity to "own" the wireless data segment if it can communicate the benefits. Mr. Kagan and other analysts believe AT&T Wireless and other AT&T Corp. spinoffs at some point will drop the AT&T moniker. If that happens, he said, "All that will be left of AT&T is a piece of Americana."

Industry watchers considered Ogilvy the favorite from the start. To some extent, Ogilvy has already taken a crash course in all things wireless: It's worked on Motorola's global account since last fall. Motorola budget cuts have zapped Ogilvy's opportunity to do for Motorola what the agency's done for IBM; AT&T Wireless gives Ogilvy the chance to show it can pull off another IBM.

The agency went all out preparing for the pitch. "I think that as sophisticated as we like to think we are, we're just interested in wireless and have been for a number of years, but we have to immerse ourselves in the technology and also make sure that at the same time, we support their [AT&T Wireless'] needs for demand generation," said Ogilvy Vice Chairman Steve Hayden.

FCB's New York president, Jeff Tarakajian, put the loss into perspective. "When AT&T Wireless announced they were putting their account into review, it was apparent they wanted a complete break from the past as they launched their new company.

"We knew our only shot was to present them with a `new FCB,' which is why we pitched it out of New York instead of San Francisco." Just last week, FCB started the spinoff on its way with TV and print ads that tell a new story for AT&T Wireless.

Contributing: Mercedes M. Cardona

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