AT&T's Dorman is likely next CEO

President named to board

Noski to vice chairman

February 22, 2002|By NEW YORK TIMES NEWS SERVICE

By all appearances, David W. Dorman would have to do something shocking to avoid becoming AT&T Corp.'s next chief executive.

That became clear yesterday as AT&T named Dor- man, the company's president, to the board. It has been clear for at least a year that Dorman was the favorite to become the chief executive once the company sold or spun off its cable television operation.

With yesterday's announcement, the favorite became all but a shoo-in.

AT&T also announced that Charles H. Noski, the company's chief financial officer, had joined the board as vice chairman.

Dorman's appointment to the board is fairly straightforward. Steeped in the telecommunications industry, Dorman, 48, has been president of Sprint's business services unit, chairman of Pacific Bell and, after an ill-fated detour into cyberspace as chairman of Pointcast Inc., chief executive of the Concert joint venture between AT&T and British Telecommunications PLC.

He became AT&T's president in November 2000, and his main responsibility these days is running the division that sells communications services to business customers. AT&T spun off its wireless operation last year. If everything goes as planned, the company will issue a new stock to track its consumer operations this summer and will complete the sale of its cable business to Comcast Corp. late in the year.

At that point, all that will be left in the core AT&T will be the business services operation. The consumer operation will also legally belong to AT&T but will trade as a separate stock.

With the cable deal, Armstrong is set to leave AT&T and become chairman of the new AT&T Comcast. Dorman's election to the board is a natural precursor to winning the chief executive's job, though it appears possible that someone else could become chairman for a couple of years before Dorman assumed both top jobs.

While Dorman's elevation is fairly simple to understand, Noski's elevation to vice chairman is more intriguing.

Noski appears to be Armstrong's closest confidant in the business world. When Armstrong ran Hughes Electronics in the 1990s, Noski was the company's chief financial officer. When Armstrong wanted a new chief financial officer at AT&T in December 1999, he brought in Noski.

A strong case can be made that if Armstrong had brought Noski with him when Armstrong first joined AT&T in 1997, AT&T would not be breaking itself into separate companies today. Armstrong is a salesmanlike, even idealistic, executive. Noski, 49, is an unassuming pragmatist. Most important, perhaps, Noski appears to serve as Armstrong's ballast and can say no when necessary. Armstrong did not appear to have anyone quite like that around him during his first years at AT&T.

In hindsight, AT&T appeared to overreach when it outbid Comcast and agreed to acquire MediaOne Group Inc. for $58 billion in May 1999. In some ways, the financial strain of that deal essentially led to AT&T's current break-up. Many communications experts and even some people close to AT&T think that if Noski had been at AT&T at the time, he would not have let Armstrong agree to the MediaOne deal at that price.

In an interview yesterday, Noski sidestepped the question.

"I wasn't here at the time," he said. "I'm not going to try to second-guess. When I got here, we had what we had and I had to work with the hand I was dealt."

Noski is to remain AT&T's chief financial officer. As vice chairman, he is to concentrate on carrying out the company's restructuring plan, the dismantling of the hand he was dealt.

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