Fall of AT&T Wireless

DMZ · September 21, 2004 at 8:31 am · Filed Under Off-topic ranting 

You may already know that I spent over five years working at AT&T Wireless, and have some strong opinions on how the company managed to destroy itself. The Seattle PI has a long, insightful article on this today, which is the best piece I’ve seen written on it so far. It’s particularly good on the cultural and leadership issues that infected everything about the company. John Zeglis was paid many, many millions for the utter incompetence that destroyed AWS, and will receive tens of millions more when they snuff the candle. I think of this every time someone tells me that baseball players are overpaid.


24 Responses to “Fall of AT&T Wireless”

  1. Paul Weaver on September 21st, 2004 10:41 am

    The CEO who comes in with the big jet and bureaucratic padding ruins the company. How do these guys get the job?
    It sickens me to see lavish bosses who cut or disillusion valuable employees – and everyone is worse off. I’ve got a boss who looks me in the eye and says ,’we just can’t afford to hold onto these people.’ And I get steamed cuz I know the bosses above her are making gross multiples of those people who are “let go.” (often being replaced with a cheaper/less experienced temp)
    He’s like the Bill Bavasi of AT&T, eh? Speaking of Bill Bavasi, did you read the rip on him in ESPN page 2?

  2. Evan on September 21st, 2004 11:23 am

    Nice Bavasi attack.

    The best part of that article was how 600 of SF’s 787 runs have come in innings with a Barry Bonds plate appearance. I need to work that out for the best players on other teams to see how completely insane that really is.

  3. Dave on September 21st, 2004 11:36 am


    Stats like that seem impressive on the surface, but think of it this way; most of Bonds walks are going to come with runners in scoring position and first base open. You would expect that a team will score a great majority of their runs in this kind of situation. This is a case of strong correlation but not necessarily strong causation. Bonds is walked a lot in situations that also tend to produce a lot of runs, but the walks are more a biproduct of situations that are already going to lead to runs, walk or not.

    Bonds’ season is remarkable, and we don’t need misleading stats like this to tell us that. Let’s just stick to the ridiculous .612 on base percentage if we want to say “wow”!

  4. theberle on September 21st, 2004 11:40 am

    My AT&T contract ends in less than a week. I’m so excited

  5. Don on September 21st, 2004 11:45 am

    I used to work at AT&T Wireless in 2000-1.

    I read the article.
    Interesting they made no mention of Fixed Wireless, where I was.

    I would like to see Michael Keith’s head mounted on a wall next to Zieglis. They both made alot of money for nothin’.

    And yes, all CEO’s and Baseball players are way overpaid.

    All of them.

  6. DMZ on September 21st, 2004 11:53 am

    Baseball players are not overpaid. That’s all there is to it: the other argument is based on jealousy and utopian utilitarianist “their pay is out of whack with the value they contribute to society” arguments.

  7. Paul Weaver on September 21st, 2004 12:13 pm

    If baseball players are overpaid, then there would be no point in putting a team out there, because the owner would just lose money. If you are willing to pay the price of a ticket (or soak in that advertising from tv), then you are contributing to the owners, the players, and anyone else who profits off baseball. It’s not a bad system. DMZ, I wouldn’t just chalk it up to jealousy – there are other factors in terms of why one person gets mad that another makes too much or too little for what they do – why do we get mad at Bavasi or this Zeglis guy? Is it because we’re jealous? <-(Rhetorical question) Why do I get upset when a single mother of two brings home minimum wage? Is it jealousy? ....I'm starting to sound like a socialist, I better shut up and go back to reading American and British economists. 🙂 Anyway, I think your "Utopian Utlitarianist" assumption is closer to what Don sees as injustice in Player and Owner pay. And I have no answer other than justifications for why they get so much. But I like watching baseball, so it's much less challenging right now to get mad at a CEO who ruins a company. GRRRR!!!! Also, Bonds 600 out 787 runs in an inning where he gets a plate appearance. I have a feeling it would be pretty high for any 3-5 hitter - considering they have a much more likely chance of coming to the plate if it is a inning where someone will score a run - they have about a 1 in 3 chance even if they hit .000. But to hear that that offense scores just as much as St. Louis....wow. Bonds is shattering all of my assumptions about the value of a great hitter.

  8. Alex on September 21st, 2004 12:15 pm

    Hi Derek,
    I work for Verizon Wireless, but I know of many people who have left our company over the years to go to AWS. You and the others that I know over there have my deepest condolences for what you’re going through with your company. I’ve personally been laid off twice in the past and can vouch for the fact that it is horribly difficult. I hope things work out for you…

  9. Paul Weaver on September 21st, 2004 12:24 pm

    Weird, I actually wrote a whole lot more than that for #7…oh, it interpreted something I wrote as HTML…gah!
    “Is it because we’re jealous?” is a rhetorical question.
    Don thinking players and owners are getting paid too much is probably more because of the “Utopian Utilitarianist” argument.

    Bonds: 600 of 787 runs in an inning in which he has appeared is probably inflated by the fact that ANYONE is more likely to get a plate appearance when a run is scored – more people come to the plate. The Giants scoring as much as the cardinals, however, – that is a big WOW. It shatters many of my preconcieved notions about the value of one hitter.

  10. Evan on September 21st, 2004 12:31 pm

    Hence my assertion that one needed to see the numbers for other players to see how big a deal that 600/787 really is. I expect the number to be at or above 50% for every player in baseball.

  11. Evan on September 21st, 2004 1:07 pm

    Incidentally, if you want lousy stats, check out MLB.com’s new O Zone Factor:


  12. Troy Sowden on September 21st, 2004 1:27 pm

    I agree, the point about 600 of their runs coming when Bonds has a plate appearance is flimsy. The concept that the Giants have scored just 5 runs less than the Cardinals is hard to even fathom. To steal a page from Batgirl’s book, Barry Bonds for President. Any BBWAA voter who doesn’t vote for Bonds for MVP should lose their vote, if not their media credentials. Seriously.

  13. Paul Weaver on September 21st, 2004 1:30 pm

    WOW! That is a ridiculous stat!

    Why there is a stat that only looks at runs scored with runners in scoring position and tries to relate that to winning is beyond me. That’s why the Yankees, with their hihger extra base hits and lower average defy that stat.

    Let me tell you my discoveries with stats, it’s simple, runs=runs.

    Hehehe, okay, let me show you a more interesting team stat:
    TB * OBP ~ Runs
    Scoring runs is largely a function of getting on base, and being driven in. The simplicity is maddening.

    Winning is a function of scoring more runs than your opponent more often. There is no defying that stat.

  14. Evan on September 21st, 2004 1:42 pm

    O Zone is about the dumbest stat I’ve seen in years.

  15. DMZ on September 21st, 2004 1:57 pm

    Uh, back on-topic and off-topic:
    I left AWS a year ago, so I’m in no danger. Don’t cry for me, cry for the friends I left there.

    On Zeglis and being overpaid: I resent his compensation because — take Cirillo. As a terrible baseball player, he’s overpaid. But he got that contract as a result of a free market overvaluing his future contributions. And as a terrible baseball player, he’s still one of the couple-thousand best baseball players in the world.

    Zeglis got his job because he was given it to keep him from leaving AT&T when he was General Counsel, and he was chosen over other, better-suited internal candidates. He got a ton of money to take his job. While in his job, he proved he was the wrong man for the job, but retained his position for no reason (this being a future case study for business students in the need for a strong and independent board of directors) and was extremely well-compensated for his poor leadership.

    Meanwhile, on the bottom rungs, they constantly cut costs to improve the bottom line while the business itself floundered. Company has no long-term plans — quick, lock up the office supplies! John Zeglis wants a new plane, and at the same time they cut benefits.

    Then, and this is what realllly gets me, in negotiating the takeover, Zeglis happens to get $20m. Wacky!

    Now, they’re both overpaid for their contributions. But Zeglis never did anything to justify anything he got at any step of the way, and at the end, he gave himself $20m for his trouble.

    It’d be like… what if Gillick had a son and put him on the Mariners, gave the kid a $25m/year auto-renewing contract with a $20m buyout clause, and the only way to stop being a Mariners fan and attending games etc was to move cities and leave all your friends.

    That’s what Zeglis was to me and my job.

  16. Ignatius on September 21st, 2004 3:52 pm

    Now if baseball players could just change their statistics….’let’s see, I think I’ll change this home run total from 14 to 42….hmmn, yeah, that looks better.’ like C.E.O’s do, well then, I would say C.E.O.’s should probably make as much as an average baseball player even though most of them are dumber than most baseball players.

  17. Ignatius on September 21st, 2004 4:13 pm

    The formula I like to use rate hitters or teams is runs scored plus runs batted in minus home runs divided by at bats. The reason I like this because it shows Bonds killing everybody else, which he does.

  18. DMZ on September 21st, 2004 4:55 pm

    Ignatius — that’s an excellent example. Zeglis, for instance, set company-wide goals for the executive compensation and when they didn’t make them because the company had no strategy and was going down the tubes, they just re-set them. Millions to Zeglis & Co., while down on the ground, people were getting smaller raises etc because the company wasn’t doing well.

  19. Adam on September 21st, 2004 6:11 pm

    If O Zone were to be combined with Productive Outs, it would be like the anti-OPS.

    And what would you call it? 0-Productive Zoneouts?

  20. Dave D on September 21st, 2004 9:43 pm

    When will these Northwest companies quit allowing out of town management to foul them up? Boeing gets killed from within by the Stonecipher virus — turning the industry leader into a carbon copy of McDonnell Douglas — brilliant! — then not to be outdone, ATT Wireless lets these nitwits from New Jersey run them into the ground while raking in the bucks back east.

    The northwest really is better at running companies that work — look at what happened to Wizards of the Coast — they were a great success when independent, now they are a shadow of their former selves being run as a division of Hasbro.

    The professional entrepreneurial culture really is better here, I’ve lived elsewhere, and the northwest is an incubator for business growth. Then along comes some nitwit old money from outside the region trying to buy up the success, and invariably they’ll screw it up. This happened to a company I worked at for 4 years as well — when we were local it was great, once we were bought out by an eastern company, things immediately got stupid at work and decision making was now done by people 3 time zones away that had no idea what made things here tick.

    Just felt like ranting, I like the northwest best of anywhere I’ve lived, and hate to see its culture be bled off by leeches from other parts of the country that buy up what works from here then screw it up for themselves.

  21. Paul Weaver on September 21st, 2004 11:35 pm


  22. Evan on September 22nd, 2004 9:42 am

    0-Productive Zoneouts. I like it.

    O Zone * Productive Outs. Worst stat ever.

  23. Don on September 22nd, 2004 11:42 am

    Sorry DMZ,

    I respect your opinion but jealousy has nothing to do with it.

    I simply do not believe in disparity of wealth, therefore, all

    ballplayers and CEO’s are overpaid.

    An earlier post got right to the point: Jeff Cirillo.

  24. DMZ on September 22nd, 2004 12:03 pm

    Okay, if you think everyone should be equally compensated no matter what their job, sure, that would lead you to such a view without jealousy.