AT&T hopes to bolster mobile life with new innovation centers

The company is opening one "foundry" in Atlanta near Georgia Tech and adding a second location to its Plano, Texas, facilities.

Roger Cheng Former Executive Editor / Head of News
Roger Cheng (he/him/his) was the executive editor in charge of CNET News, managing everything from daily breaking news to in-depth investigative packages. Prior to this, he was on the telecommunications beat and wrote for Dow Jones Newswires and The Wall Street Journal for nearly a decade and got his start writing and laying out pages at a local paper in Southern California. He's a devoted Trojan alum and thinks sleep is the perfect -- if unattainable -- hobby for a parent.
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Roger Cheng
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The site for AT&T's foundry in Atlanta. The facility is still under construction and isn't open yet. AT&T

AT&T said on Tuesday that it plans to open two "innovation centers" as it looks to make good on its initiative to pursue more avenues of the mobile business beyond smartphones and tablets.

AT&T plans to open what it calls a "foundry" in Atlanta near Georgia Tech and focus on its Digital Life play, or connecting everything from homes to cars with cellular gadgets. The company plans to open a second facility in Plano to focus on machine-to-machine connected devices, such as ATM machines or digital billboards.

The two innovation centers are part of a broader drive by AT&T to remake the stodgy telecom company into a leaner, quicker machine capable of jumping on new trends. The foundries serve as feeders for new ideas both from within the company and from regional start-ups.

"The more we do them, the more I'm convinced this is absolutely the right thing to do," said Ralph de la Vega, head of mobility for AT&T. "Innovation isn't in one place; it's in many places."

Whether these foundries will have a significant impact on such a large company remains to be seen, but AT&T is certainly investing in them with the hopes of tapping into local talent. In addition to potentially snapping up services and apps that come out of the foundries, the facilities also serve to connect young entrepreneurs with investors.

"There's a lot of innovation going on in Atlanta," de la Vega said in an interview on Monday. "We like what we see in the ecosystem."

The Atlanta center will focus on developing apps and services for AT&T's connected car business, its home security service Digital Life, emerging devices, and its U-Verse Internet, phone, and television offering. AT&T has made a lot of noise about its connected car business, having signed big-name players such as General Motors, and in April launched its home-security business in the first 15 U.S. markets.

De la Vega teased one project, which involves a startup's approach to identifying potential leaks in plumbing. The smart sensor could detect a potential leak by using radio waves to detect the flow of water. Such a sensor could be used to automatically shut off the water to avoid further damage to the home.

"[Customers are] going to get innovation in their products a lot faster than otherwise," he said.

Meet the group trying to make AT&T very un-AT&T-like

With the battle for smartphone customers growing ever fiercer and the pool of potential consumers shrinking with more and more people already carrying mobile devices, AT&T -- like its rivals -- is looking for new areas of growth beyond its traditional wireless and wireline service.

AT&T already touts its connected devices business, which adds a cellular hook-up to everything from a dog collar to a medicine pill, and wants to push its network connection into even more gadgets.

The company plans to spend an additional $14 billion over the next three years to improve the quality of its network to offer such services and connections.

The Palo Alto AT&T foundry. Roger Cheng/CNET

The Atlanta facility is part of a joint effort between AT&T, Georgia Tech, state and local businesses, and networking equipment supplier Cisco, which serves as "host sponsor" and will work on projects with the telecom company.

The second facility is an extension to an existing innovation center in Plano. It too will focus on connected devices, but more on the business end. That includes sealed shipping containers with connected sensors that detect moisture, or an item-level inventory-tracking system.

AT&T said the foundry will work on rapidly designing and building prototype hardware and software, which business could see as a service offered by the telco down the line.

The Atlanta facility will house nine AT&T employees, while seven will man the Plano center. In comparison, the Palo Alto, Calif., foundry has 35 employees.

AT&T declined to provide the cost of the foundries but noted that the total investment in the startups and individuals it is working with is $100 million, a figure that includes contribution from the telco and partners Cisco, Ericsson, Alcatel-Lucent, and Amdox.

The facilities are under construction now, and de la Vega said he sees them opening in the third quarter.