The bankrupt telco, which has decided to change its name to MCI from WorldCom in the wake of a multibillion-dollar accounting scandal, said Wednesday that it has appointed Roscitt to its No. 2 executive spot, under CEO Mike Capellas.
During his tenure at AT&T, Roscitt led the network management and consulting arm called AT&T Solutions before a 1999 promotion to run Ma Bell's entire business services division. In a decidedly poorly timed move, Roscitt then jumped from AT&T in 2001 to take the top job at Eden Prairie, Minn., telecom equipment supplier
. ADC's stock has fallen 86% since Roscitt took over.
But Roscitt's return to the communications services side of the industry was heralded as a positive development by some observers who feel it could help restore some stability to a shellshocked sector.
"I think this is very encouraging for the prospects of MCI and the rest of the industry," says Lehman Brothers analyst Blake Bath. "He's a seasoned business services executive that can bring back some rationality to the business."
In the past three years, the phone services sector has been flooded by a confluence of damaging events. The lingering effects of a weak economy -- combined with an ambitious crop of upstart telcos offering technical superiority, and in some notable cases, shoddy bookkeeping -- have led to a mercilessly destructive price war.
To observers such as Lehman's Bath, Roscitt represents a bit of the old-school approach, which emphasizes service quality and a broad array of capabilities over the brutal price-cutting practices that have been in vogue of late.
Tapping a business services hard-hitter like Roscitt also sends a clear signal that MCI may be moving away from its popular consumer services business, which faces severe challenges once discount-pricing mandates expire over the next three years.
Even though long-distance revenues have shriveled dramatically over the past several years, selling data service to companies continues to be one of the few promising arenas within the industry.
On the basis of their scale and expertise, AT&T and MCI are likely to remain the top two contenders in this lucrative market.