AT&T; May Go Head to Head With American Express

AT&T; Corp. is considering offering a business credit card that would place the company in direct competition with American Express Co., which dominates the market for corporate customers.

The two companies have been jointly marketing CorporateLink, an American Express card for small business customers that allows users to track their phone calls and business purchases jointly.

The two companies have also signed a contract that puts customers’ AT&T; calling card traffic on American Express reports.

“This is an ideal product that will allow AT&T; to leverage its business accounts to pass along travel-related discounts and benefits to its customers,” said Chris Landes, an analyst at TeleChoice Inc., a Verona, N.J.-based consulting firm. Landes worked on a 1990 study about a possible AT&T; universal business card when he was at AT&T.;

AT&T; has a chance to shake up the business credit card market much as it did the consumer market five years ago by waiving the annual fee for credit cards. Before AT&T; entered the consumer credit card market, about 90% of card issuers charged their customers annual fees, McKinley said. Today, only 45% of them do.

AT&T;’s consumer credit card also serves as a calling card.

“AT&T; has an opportunity to displace American Express business cards,” said Robert McKinley, president of Ram Associates. “American Express is a big sitting duck.”

Mitch Montagna, a spokesman at AT&T; Universal Card, said AT&T; is only testing a business card and hasn’t launched it yet.

Officials at American Express couldn’t be reached for comment.

In a separate development, the company’s chief financial officer, Michael Monaco, quit following a dispute with his boss, Chairman and Chief Executive Harvey Golub, over the assignments of “a number of senior people.”

Monaco’s resignation focused on a weeks-long quarrel with Golub over Walter Berman, the head of finance for American Express’ travel services unit, which includes the American Express card business, a person familiar with the company’s finance unit said.

The resignation followed more than 1 1/2 years of disagreements between Monaco and Berman over reassigning members of the travel unit’s finance staff, the source said. Monaco, Golub and Berman didn’t return calls and a spokesman declined to comment.

American Express has about 80% of the market for business credit cards, McKinley said, making it a large part of the firm’s business.

Visa and MasterCard, the leading card issuers for consumers, have about 4.5 million business cards, just 1.3% of their 340 million consumer cards, McKinley said.