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AT&T Powers Phillips 66's Private Network Mobile Connectivity

Zacks Equity Research

AT&T Inc. T has collaborated with industry partner Accenture plc ACN for the development of a private cellular network for energy manufacturing firm Phillips 66 PSX. In addition to an industrial wireless connectivity solution, the collaboration is likely to sow the seeds of potential, low-latency 5G applications for the Industrial Internet of Things (“IIoT”). 

A private cellular network refers to a local mobile network comprising cell sites and core network servers. It aims to supplement the connectivity requirements of a business enterprise by plugging the cellular performance gaps of an existing public network. Leveraging such enhanced capabilities, Phillips 66 intended to augment its cellular connectivity near one of its refineries in Belle Chasse, LA, as part of its digital transformation initiative and sought the technology prowess of Accenture and AT&T.

AT&T operated as the telecommunications provider for Phillips 66, functioning as the backbone of a seamless connectivity solution with dedicated network capabilities using multi-access edge compute across the licensed spectrum. This, in turn, has resulted in enhanced mobile applications in day-to-day business activities, such as safety inspection for oil distillation units and capacity tracking. The development of sustainable engineering solutions based on pervasive connectivity has improved operational efficacies with greater flexibility and security features, likely encouraging the energy firm to replicate its success in other locations as well.   

The alliance is based on the perceived demand escalation of the new business and consumer applications with the wide proliferation of 5G, cloud and edge computing services. Edge computing forms a core focus area for AT&T and marks a positive stride forward in providing faster processing and potentially enhanced security for business applications.

Moving forward, AT&T anticipates gaining an advantage over rivals through edge computing services that allow businesses to route application-specific traffic to where they need it and where it is most effective — in the cloud, the network or on their premises. Through its multi-access Edge Compute solution, the company offers the flexibility to better manage data traffic. It leverages the indigenous software-defined network to enable low-latency, high-bandwidth applications for faster access to data processing.

AT&T expects edge computing solutions to be widely available in autonomous vehicles, drones, robotic production lines and autonomous forklifts in the near future. Utilizing ML techniques and more connected devices, this could transform the way data-intensive images are transferred across the industry on a real-time basis for actionable intelligence, enabling unique digital experiences and smarter operations.

We remain impressed with the inherent growth potential of this Zacks Rank #3 (Hold) stock. It has lost 11.4% over the past year against the industry’s growth of 2.8%.



A better-ranked stock in the industry is United States Cellular Corporation USM, sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

United States Cellular delivered a positive earnings surprise of 104.1%, on average, in the trailing four quarters.

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ATT Inc. (T) : Free Stock Analysis Report
 
United States Cellular Corporation (USM) : Free Stock Analysis Report
 
Accenture PLC (ACN) : Free Stock Analysis Report
 
Phillips 66 (PSX) : Free Stock Analysis Report
 
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