DEFINITION of 'C. Michael Armstrong'

C. Michael Armstrong is a former CEO and chairman of AT&T from 1997-2002 when he resigned following a restructuring of the company. He led AT&T to acquire two of the largest cable television companies in 1998 but had to break up the new company in 2001 in the wake of the dot-com bust. Prior to joining AT&T, he held high-level positions at IBM, where he worked for 31 years, and at Hughes Electronics, where he helped launch DirecTV. Armstrong is also a member of the Council on Foreign Relations. 

BREAKING DOWN 'C. Michael Armstrong'

Born in Detroit in 1933, Armstrong received his BS in Business and Economics from Miami University in 1961 and took a job with IBM, where he worked for 31 years until 1992. In 1976, he attended the Advanced School of Management at the Dartmouth Institute. 

From 1961-1978, he worked at various executive positions inside IBM until he became President of the Data Processing Division in 1978. Armstrong would eventually hold a number of key positions inside IBM, including extensive experiences with foreign posts such that he became the President and chairman of the EMEA portions of IBM’s global footprint. (EMEA stands for Europe, the Middle East, and Asia.) Within the company, Armstrong was charged with ramping up IBM’s international sales and he made frequent trips to his customers base throughout the EMEA customer footprint. His positioning within the company as a frequent visitor to foreign locales helped earn him a seat on the Council of Foreign Relations.

A protégé of IBM CEO John Akers, Akers informed Armstrong privately in 1992 that he would not recommend him to become IBM’s CEO. This disclosure may have prompted Armstrong’s move away from IBM towards Hughes Aircraft, the defense division of General Motors Hughes Electronics, as chairman and CEO. The move stunned many, either that Armstrong would leave IBM or that a defense contractor like Hughes would clearly be moving new products towards the consumer market. One of Armstrong’s projects during his time at Hughes included the launch of DirecTV, whereby the consumer electronics revolution now included satellite dishes for individual homes.

Armstrong would be at General Motors and Hughes Electronics for five years between 1992-1997. Armstrong got to work right away. With the focus away from defense and towards consumer technologies, he met with Pentagon officials and told them he wanted a thirty percent reduction in cost on their projects, and also soon laid-off 16,000 workers to raise capital for projects like DirecTV and OnStar. Armstrong’s style and action paid off as sales and profits declined and the stock value rose from in the $20 range when he was hired to $70 by 1996.  

The rapid success of DirecTV led AT&T to come calling and by 1997, Armstrong had a new job offer from AT&T to become their chairman and CEO.  He was the first outsider to ever be hired to this position. Though AT&T is an enormous business, at the time it was faltering and needed direction. Armstrong made movements to cut costs and underperforming employees, and profits and the stock price began to rise. This helped to fuel the plans Armstrong had for the company, which by then included the convergence market of television, voice and data via coaxial cable, a deal which set in motion an eventual break up of the company in the year 2000 into four separate divisions: cable/broadband, cellular/wireless, business, and consumer/residential. Comcast offered to buy the broadband division for $50.5 billion and made Armstrong the chairman of that company, but he retired from business permanently in 2004.

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