Dow Darling AT&T Earnings Call Nuggets: International Acquisitions and Project VIP
Phil Cusick – JPMorgan: I guess two quick ones. First, Randall, you were quoted recently as – I don’t know if this is right or not, but saying that international or European acquisitions may be inevitable to continuing growth. Can you address that for us? Then second for John. Blowing through this buyback by midyear, that’s great. What do you think about the potential to reauthorize and how does the Board think about that so far?
Randall L. Stephenson – Chairman and CEO: Yeah, sure Phil. As it relates to international, I was asked about consolidation and I said some level of consolidation was inevitable. Obviously, we don’t comment on M&A rumors. But here’s what I’d ask you to think about. As you consider what’s happened in the last five years in the U.S., it has been impressive, what’s transpired in the mobile Internet revolution, and the U.S. has been outpacing the rest of the globe fairly considerably. I think most people expect the rest of the world will catch up. So the question we have to ask is, are there opportunities for us to participate in that growth outside the U.S.? We look at this from a lot of different ways. As more and more people around the world begin to deploy LTE, there are probably some opportunities to create some unique roaming arrangements where we roam on each other’s networks at different cost structures, which may change that dynamic somewhat; the opportunities to partner, like you’ve seen us partnering in China, our China Telecom deal that we did, and you’ll probably see those kind of deals more and more in the Mobility side.
Do you invest at the infrastructure level is a big question. And there’s really another aspect to it, and that is, can you participate in this growth outside the U.S. at the application level, and this year is going to be very instructive in that regard to us, because services like Digital Life, which is really – I mean it’s an over-the-top application for home security and monitoring and so forth, and is it possible to carry those platforms outside the U.S.; we are already licensing that platform to companies in Europe. And so, can those platforms be extended in an over-the-top model outside the U.S. So, as we kind of look at this, we do believe the U.S. experience will be replicated outside the U.S. and we’re just trying to decide, how is that we would participate in that and there are a lot of avenues for that.
Phil Cusick – JPMorgan: That sounds like acquiring something is less on your mind than other opportunities?
Randall L. Stephenson – Chairman and CEO: There’s just a lot of different ways to think about it, and that’s all I’m trying to characterize here, Phil. There’s a lot of options.
Phil Cusick – JPMorgan: Okay, thank you. John?
John Stephens – SVP and CFO: Phil, with regard to your question, first and foremost, it’s a Board decision on the authorization, so we’re going to work within the authorizations we have currently. Secondly, in evaluating, in providing information with regard to share buyback, first and foremost, it’s a question of valuation of your shares compared to the market price that is out there, and we look at what analysts say, we look at our own internal valuations of our share price, and we look at what the market is trading the stock at. But before you get to a further authorization, you need to make sure that; one, your cash flows from your business which we’ve had really very solid cash flow performance is have to make sure you can continue to reinvest first, you can continue to pay your dividend first, and you have enough cash flow left over to be able to take advantages of opportunities; like Randall mentioned today, an opportunity to get some more spectrum in the NextWave transaction that we closed today.
If you’re comfortable with that, then you go into the decision of what do you do with that extra capital? That’s the process we go through one on a regular basis and we will continue to do that. This is a unique time from a market perspective in that the cash costs of our equity are high compared to traditionally. Interest rate and borrowing capacity that’s out there and that’s the reason why we’ve incurred slightly more debt than we usually carried.
Simon Flannery – Morgan Stanley: I wonder if we could talk about the CapEx side of the equation. You’re taking about $21 million, just a mid-single-digit year-over-year. How should we think about that in the context of the analyst meeting and that’s sort of up to $22 billion. What’s the delta there and are we still looking at $22 billion possibly over the next couple of years or are you think you be more efficient in achieving some of the goals? Could you be more specific about what you’re going to see with Project VIP in ’13? You’ve talked about the LTE rollout but perhaps on the wireline side, should we be sort of hitting a third of the three-year targets over the next 12 months or any other color on that would be great.
Randall L. Stephenson – Chairman and CEO: So, let me try and answer a couple of your questions. First and foremost, the $22 billion we gave in November was that information related to a three-year plan. Since that time we’ve really been able to put pen to the paper from an engineering perspective and really work specific business case is a more detailed level and that’s providing some of our opportunities. Quite frankly, we had more efficiency in our capital program last year and finished as for example we mentioned that today we are were about 174 million POPs covered with LTE, our commitment for the year end had been about 150 million. So, we’re ahead of our achievement and spend some money efficiently.
We are taking that into account. And then lastly, we’ve been able to identify some, if you will, shared savings, where the overlap between our wired and our wireless projects in VIP are going to allow for some more efficiency. All of those pieces go into the guidance that’s $21 billion, and we are comfortable with that $21 billion range. Specifically with regard to achievements, we are expecting to get 250 million POPs covered with LTE by the end of this year. We will also make – we’re not disclosing specific levels of fiber-to-the-building or expansion of U-verse footprint at this time. But you can think about it as kind of a ratable build schedule as we go forward, and we are moving forward today with some of the fiber-to-the-building efforts and moving forward immediately in ’13 on very many of those velocity projects. It’s not a question of moving capital or costs into later years. With our financial flexibility, we will do as much as we can as early as possible.
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