AT&T Wireless outsourcing jobs overseas

AT&T Wireless Services has begun plans to outsource some of its information technology work to lower-cost operations overseas, according to people familiar with the situation and documents obtained by the Seattle Post-Intelligencer.

The Redmond wireless service provider, which employs 30,000 people, including about 3,800 in the information-technology group, said it is still evaluating options and no decisions have been made.

But employees and internal documents indicate that the outsourcing process has already started.

"The marching orders are that we are going to do it," said one employee who expects to receive his layoff notice in January. "Now we are just trying to figure out the mechanics of how to do it." He said as many as 70 percent of the IT staff could lose their jobs.

Tata Consultancy Services and Wipro, outsourcing companies with large operations in India, have consultants working on the AT&T Wireless campus in Bothell, said the employee, who requested that his name not be used. That is creating an awkward situation for some AT&T Wireless employees who believe that they are essentially training their replacements.

"It kind of feels like you are talking to your hangman," said the employee, who is working directly with the Indian consultants. A second source confirmed that Tata has consultants working at the company.

A document provided to the P-I by high-tech labor organization WashTech indicates that Tata has a plan for shipping the IT work overseas. Titled "Knowledge Transfer Plan for Process, Tools, Automation," the 26-page document details such things as transition times and staffing.

Three Tata managers did not return calls and a fourth hung up before a question could be asked. A spokeswoman at Tata declined to comment, referring questions to AT&T Wireless. AT&T Wireless spokesman Mark Siegel declined to comment on the plan or the partners working with the company on it.

In a memo to the company's information technology workers yesterday, AT&T Wireless Chief Information Officer Christopher Corrado confirmed the company was outsourcing some work. AT&T Wireless yesterday signed a letter of intent with Hewlett-Packard to take over desktop services, retail field services, the service desk and other functions, the memo said. It was unclear how many jobs would be affected by the switch or if employees could transition into HP positions. It was unclear if some of the work would be sent to India, where HP has an operation in Bangalore. HP executives could not be reached for comment.

Siegel declined to comment. But Corrado -- a former executive at Wipro who joined AT&T Wireless in April -- did not rule out more outsourcing agreements.

"Outsourcing always plays a role in balancing quality services and costs. We currently outsource work throughout the company, including work within both customer services and IT," the memo said. "We will continue evaluating the best mix of internal and external resources as we work to achieve best-in-class margins."

AT&T Wireless has initiated a plan called "Project Pinnacle," a companywide effort to cut costs while boosting profit margins to as high as 40 percent. Part of that plan includes 1,900 job cuts, which were disclosed last week in a Securities and Exchange Commission filing. Those cuts will occur throughout the company. The Wall Street Journal reported yesterday that an additional 3,000 jobs could be cut, with the work being sent overseas.

If AT&T Wireless follows through with plans to ship work to India or other locations, it certainly would not be the first Seattle area high-tech company to do so. Amazon.com, Click2learn, Microsoft Corp., WatchMark and Talisma have either set up Indian operations or partnered with companies that conduct business there.

Marcus Courtney, who heads WashTech, has been fighting to bring attention to the issue. He said AT&T Wireless' decision could be the biggest blow yet, representing as much as 20 percent of the work force in the state's wireless telecommunications sector.

"I think it is another example of a company that is exporting our region's best-paying, best-skilled jobs overseas for a short-term strategy of slashing its labor costs," Courtney said.

P-I reporter John Cook can be reached at 206-448-8075 or johncook@seattlepi.com

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