Head of AT&T; Business Unit Quits After Just 8 Months

AT&T; Corp.’s Robert Annunziata, who oversaw $22 billion in annual revenue from business services, quit just eight months after rejoining the No. 1 U.S. long-distance phone company to become chief executive of Global Crossing Ltd.

Annunziata, 50, joined AT&T; in July as president of business services, after the long-distance provider completed its purchase of local phone company Teleport Communications Group, where Annunziata was chief executive. He began his career at AT&T; and spent 17 years there before moving to Teleport in 1983.

The departure comes at a critical time for AT&T;, as it integrates several acquisitions and slashes billions of dollars in costs. Some analysts say the efforts of AT&T; Chairman C. Michael Armstrong to turn the company into a more nimble competitor could be slowed by turnover in top management.

“AT&T; continues to have a challenge in retaining its senior talent,” said Brian Adamik, an analyst at Yankee Group in Boston. “Armstrong needs to develop the nucleus of his management team and some stability.”

One of Armstrong’s goals is to boost revenue of the New York-based company. Under Annunziata, revenue from business services rose 4.7% in the fourth quarter, but the company still fell short of its goal of a 5% to 7% increase for the year.

Global Crossing, which is based in Hamilton, Bermuda, provides phone services via undersea fiber-optic networks. Annunziata will replace Jack Scanlon, 57, who will become vice chairman.

Global Crossing shares rose $4.25 to close at $57.88 on Nasdaq. AT&T; shares fell $1.38 to $84.56 on the New York Stock Exchange.

Michael Keith, a 21-year AT&T; veteran, will succeed Annunziata as president of AT&T; business services.