Conservation in the Cloud with AT&T’s John Schulz

October 12, 2011

JOHN SHEGERIAN: Welcome back to Green is Good, and we’re so excited to have John Schulz on with us from AT&T. He’s the Director of External Affairs, and he’s in charge of everything sustainable, getting sustainability embedded all across the different platforms at AT&T. Welcome to Green is Good, John Schulz. JOHN SCHULZ: Well, John, thank you very much, and I’m glad to here. JOHN SHEGERIAN: Hey, John, you have such a great background. Before we get into talking everything sustainability at AT&T, let’s talk a little bit about your journey. I want you to frame your journey to our listeners first before we start talking everything sustainability. JOHN SCHULZ: Yeah. Thanks, John. I’m happy to do that. I’ve been with AT&T for nine years now, and it’s gone by incredibly quickly. It’s amazing how time flies. About four years ago, I was doing, actually, a very different job. I was working in real estate, believe it or not, working on making their portfolio more energy-efficient. I actually went to my leadership and said, “Look, I want to be really engaged with the sustainability piece of our operation and really making us leaders in that space,” so I actually got pretty far up the food chain and was given an opportunity to transition my role over into greenhouse gas emissions inventory, strategy, energy efficiency operations. For the last four years, I’ve actually been working with the energy efficiency group, and then for about the last year, I worked with the corporate strategy group related to sustainability. I’ve been really very fortunate. I kind of went for it a couple of years ago, and I’ve been very fortunate to be able to follow that lead, and I’m really pleased to be here today. JOHN SHEGERIAN: We’re so honored to have you. This is AT&T’s first time ever on our show. We hope first of many. AT&T is doing so many great things in sustainability. Before we get going, John, I just want to direct any listeners. Mike and I are on our iPad and our laptop now. Any of our listeners who are in front of their technology right now and want to pull up John’s and AT&T’s amazing website on sustainability, please go to www.att.com/csr. John, talk about AT&T and everything that you’re touching with regards to sustainability. This is your show, and you guys are doing so much. I want to have a real opportunity for you to share what’s really going on at AT&T right now in sustainability. JOHN SCHULZ: Thanks, John. I appreciate the reference to our website. That’s much appreciated. There’s good stuff up there. What I’ll say is when you talk about sustainability, a lot of different things come to mind. Everyone has a different definition of what sustainability means, and for us, it’s a really broad, broad subject. It’s not just the environment. We’ll talk a lot about the environment today, but we look really at a community level about really making contributions to our community in many different ways, primarily in the social and the environmental standpoint. We think of it in three ways. Here we go. The first is really this idea of people and communities. Without a thriving, successful, sustainable community, we can’t go on either, so it’s really about engaging with that local community, the local businesses, the local workforce, and volunteering our time and efforts. If you think about volunteerism, we actually volunteered as a company and as retirees over 9 million hours last year. We really have a pretty amazing contribution there. We’re also really big into education. I mean, look, we all recognize that education is really core and fundamental to where we are, so we’ve recognized that and made a pretty substantial commitment. We have this program called Aspire. Over the next couple years, we’re going to generate $100 million in philanthropic donations to programs focused on getting high school folks to graduate, getting workforce readiness, really realizing without a good educated workforce coming up through the pipeline, we’re all in trouble here. So, it’s this idea of sustaining our communities, sustaining our business. They’re related, the shared value of our commitment to the community. So, that’s a big pillar on how we think about sustainability. The other big pillar for us is technology. Obviously, we’re a technology company. Innovation, investment, these are the core of who we are, figuring how that technology can benefit our communities. Finally, the one we’ll talk about a lot today is environment. Our job is connecting people to information, to other people. How do we do that? But how do we do it in a way that minimized our footprint? How do we be real conservative with resources? That driving efficiency is really core to the way we view sustainability as well, so it’s that broad spectrum, talking about communities, shared value, and it’s not just a program. We’ve not come up with a fancy slogan and made all of our business units listen to this fancy slogan. It’s actually just the way that we do business. We’ve integrated it very tightly into all of our operations, and I think we’ve got a good platform going forward to really, again, like I said, help buoy those communities. JOHN SHEGERIAN: That is really a great beginning to understand everything you’re touching. You brought up the terminology “shared value.” For our listeners out there who, many of them, including Mike and I, are great customers and happy customers of AT&T, how does the shared value approach that you take translate to benefitting your great customers? JOHN SCHULZ: What I mean by shared value is really the idea that a rising tide raises all boats. If we’re making investments that make everyone benefit, we’ll be a part of that as well, so that’s really what I mean by the shared value and shared benefit of what we’re doing. There are two ways that you can think about how it benefits our customers. One is just in the sheer capacity and abilities of our network. If you think about what’s happened over the last couple years, it’s pretty mind-boggling to think about the devices that you’ve mentioned. They didn’t exist a couple years ago. The capacity to make those things work is all based on our ability to make the network robust. Over the last couple years from 2008, we’ve experienced 5,000% data growth. 5,000% is a stunning number. Think about that demand on our network. Job one for us is making sure that our customers have a great experience, so we’re investing lots of money to over $20 billion last year, close to that amount this year. So, an incredible focus on making that network better because everything we’re going to talk about today, none of it works if we don’t have a great network. So, that’s really the first benefit that we’re talking about, shared value. The other is actually the part that I think is most exciting and gets your imagination running because if you think about what that network can do for us and how much growth we’ve seen over the past couple years, you can only imagine what’s coming. A lot of people have looked at it from a historical perspective. If you think about the 19th century, it was the agricultural revolution. You’re getting agriculture organized. The 20th century was the industrial and manufacturing revolution. A lot of people think that this 21st century is the communications revolution. It’s the idea of how do we do more with less by leveraging this communication ability, by leveraging access to information, leveraging that for efficiency and responsible consumption of resources? So, a lot of people, I think, if you look around, you’ll see that some pundits think that this is really the next great frontier, and it’s that idea of creating a network that opens the doors for these enabling technologies. It opens the doors for these ways of being efficient. When you talk about those benefits, it starts with the network, and then it’s all about what you can do with it and all the wonderful opportunities that it can present. JOHN SHEGERIAN: So, you’re very bullish on the future, not only of AT&T and of the network that you’re continuing to grow, but overall, you’re very bullish on what that means for your consumers. Let’s go back to sustainability. You feel that because the network’s only getting more robust and able to do more, that’s going to create a more sustainable society. JOHN SCHULZ: Yeah, I think so. If you look at it, people love their smart devices. I was once in a room with some people, and I asked people if they’d be willing to give away their smart phone or their kid first, and you may not want to know the answer. People were more willing to give their kid away than their smart device. People love these things, and they use them for lots of incredibly innovative ways. Think about just even the old summer road trip. We all piled in the minivan, and we didn’t even think about bringing an atlas. The road atlas is a thing of the past. We brought our phone. The phone helped us get us there, and it showed us the most efficient way to get there with the least amount of fuel use. If we got lost, it helped us get back on the road. Those simple things that allow you to be more efficient with the way you use your car, with the more efficient way you use your electricity, I think those are the types of things you’ll see in the future. If you look into the future, it’s hard to predict, right? Who knows? 10 years ago, no one would have believed what we can do with these smart tablets these days, so it’s hard to predict, but I would guess that you’ll see more in this space where we’re connecting things to things. This idea of machine to machine, where we’re getting information from things that will help us be more efficient. We’ve got a whole group looking into connecting everything. Dog tags, cars, you name it, we’re looking to be able to provide information about those things into a place where you can make good, efficient decisions about their use through the power of the network. The other areas I like to talk about in this space are healthcare. We all know that healthcare is going to be a big deal. With the way the population is aging, we need to make sure we are making healthcare a priority for us. We’ve got a lot of activity in the area of connecting to people with information related to healthcare. The example I like to use is of this thing called the Vitality GlowCap. It literally helps patients remember to take their meds at the right time. It’s connected to a system that tells when you need to take your meds. It actually starts to glow to tell the person that it’s time to take it, and it also tells people who care about that person if they’re doing it, if they’re actually opening the bottle and taking their caps. This idea of connecting people to information is just going to explode in ways that we can’t even imagine. The other big one is the idea of the smart grid, this idea of seeing your electricity use. Again, visibility, accessibility, to how you’re using your resources. It’s a lot like, I think, what people are doing with their hybrid cars. I have friends who have Priuses. The game is to see how big they can get their gas mileage to go. It’s this idea of visibility, driving behavior, driving interest in being efficient. All that connection of information and then presenting it in a nice, easy way, whether it’s your phone or your PC or your TV or your tablet. That’s all part of this network. It’s all part of that connectivity. JOHN SHEGERIAN: That’s fascinating. That’s really a great platform for a couple of questions that we have. Let’s talk about telecommuting. With oil and energy prices where they are and they don’t look like they’re going to be falling in the foreseeable future, talk about the modern employee, who used to have to sit at his desk, John, but now can telecommute, and AT&T’s role in this whole connection of telecommuting. JOHN SCHULZ: It’s a huge benefit, and I’ll tell you from personal experience, because I’m actually one of those people. I am a flexible worker in every sense of the way. I no longer have an official office, but I have connectivity to everything that I need. I benefit and the employer benefits, and I think this type of thinking will benefit everyone. If you think about how we at AT&T use that, we have products that allow me to access my network, that allow me to access my files. We have products that allow me to host a meeting, where everyone can be on the phone together and look at the same information on my desktop. It’s an incredibly powerful thing. I also have a wireless device that, of course, keeps me accessible at all times of the day and night, so people can call me on the phone if they need to. This empowerment has really been a boon for me because I’ve got flexibility, I’ve got productivity. I think the company gets more out of me because I work at all hours of the day. That may not have been the case if I were just going to work at a desk. That’s a real benefit to everyone involved. We at AT&T have really kind of jumped in wholeheartedly with this. We’ve got over 13,000 employees who do it. Last year, those employees — this is a real benefit to these employees — we saved over 8 million gallons of gas that we didn’t have to use commuting. Think about the environmental impacts as well. These are nice benefits related to flexibility and connectivity, all of which, of course, is on our network. The other thing that I think is really exciting is this thing called Telepresence. I don’t know if you’ve heard about it or not. It’s an amazing product. It is video conferencing like you have never seen. It’s something out of Buck Rogers or Star Trek. It is an amazing phenomenon because you sit at the table. The table blends into these high-def screens that have the same table on the other side, and you are talking eye-to-eye, face-to-face with someone who could be across the globe. It is an amazing experience, very, very vivid. Think about the benefits to the business traveler who, rather than having to go schlep their bags to the airport, get on the plane, fly for a couple hours where they’re going to go, get them a cab to go to the meeting, go to the hotel. Instead of doing all that, you can stay home, go to this very vivid experience, and still make it home for the soccer game. It’s an amazing benefit to the employee, but also the environmental impact and savings of not having to make that much travel. So, again, it’s a product that we offer. It’s on our network, so we’ve really embraced this. Last year, we avoided $8 million in travel costs by leveraging these technologies. It’s really a fabulous platform that, again, benefits the company by those savings in terms of dollars and avoided emissions, and also benefits the employees as well, so it’s a really great product. MIKE BRADY: You know, another thing I was just thinking of, John, if there’s a pandemic outbreak, like the avian flu or something like that, your people traveling really can have an exponentially huge health benefit worldwide in a situation like this, if more business were conducted, rather than face-to-face, but going the way you’re suggesting, with that platform. JOHN SCHULZ: It’s a really good point. It’s all these small things that you don’t really like to think about, whether it’s the flu or another kind of natural disaster. We’re having the ability to work flexibility is a huge disaster recovery type assistance, so those folks can indeed continue to work either under those unusual times or times of stress. So, it’s a great point. Sometimes you don’t think about those types of benefits when you think about this ability to be flexible. JOHN SHEGERIAN: You know, John, historically, when we all thought of the cloud, we all would think of the things that are up in the sky, but now it’s become a term of art in the technology industry. Can you share with our listeners who are still confused, what is the cloud? How is AT&T involved, and how will that eventually benefit all of us? JOHN SCHULZ: It is funny. I’ll tell you what. If you pick up any of the industry rags, the cloud is everywhere. We are right there with those folks that think that the cloud is going to be a really important piece of our future. The cloud is, at its core, a pretty simple idea. It’s this idea of taking your computer or your laptop and moving the contents or the applications or the ability to do work, not necessarily on that device. Take it off that device and put it in a centralized place. You put it in a place that is specifically geared for that use. It’s a designated, high-efficiency, high-capacity data center that can do that work for you, using that connection between whatever device you’re using, whether it’s a laptop or a tablet or a phone, connecting to that high-powered, centralized capacity to do work. So, you don’t have to worry about erasing any of your hardware. You don’t have to worry about gearing things up and spending a lot of time getting the functionality ready. It’s easy to turn on. It’s easy to get how much you need, and it’s energy-efficient. The cloud is based on data centers that are tuned and have people thinking 24 hours a day about how to make them more efficient in terms of the capacity and the use of resources to make them work. So, it’s a really exciting concept, this idea of having access to your stuff really through any device, and doing it in a very efficient way. The trick here, of course, is enabling communication that connects you to that computing power. That’s where we come in, that idea of connecting you through a secure line to a powerhouse of computing. We at AT&T are all over this stuff. We’ve got the ability to do software through the cloud, we’ve got hardware in the cloud, we’ve got platforms so you can develop your own applications in the cloud. We’ve really got a robust platform available for you. But what’s hard — you hit a really interesting point. People hear the cloud, but they don’t know what it means, how to wrap their mind around quantifying the cloud, because it is such a — pardon the pun — such a nebulous term. A recent study just came out. Right now, large companies use about 10% of their capacity in the cloud. By 2020, they expect that to jump to 70%, so a huge jump in people using this. With that, because of the energy-efficiency, because of the ability to only use what you need, they’re expecting by 2020 that compared to what it is today, it will be over $12 billion in savings for those people that make that move to the cloud. With that savings numbers comes efficiency in terms of energy efficiency and greenhouse gas reductions. The estimate is that it’s equivalent to a yearly savings of 200 million barrels of oil, so this is a big deal. This is a big benefit financially and environmentally, and it gives the user a great flexible experience. JOHN SHEGERIAN: For our listeners who just joined us, we’re so honored to have John Schulz today on with us at Green is Good. He’s the Director of External Affairs at AT&T, and his website is amazing. We haven’t talked a lot about it today, but please go to it. If you’re in front of your iPad, laptop, desktop now, go to www.att.com/csr. On the website, you talk a lot about energy and what you’re doing with regards to energy. Earlier today, you talked about telecommuting, the 13,000 employees, and how much oil you save just by that. How much is AT&T doing in savings with energy-related costs? I see here on the website, there’s an amazing study where you guys announced that you deployed 4,000 alternative-fuel vehicles and 3,000 compressed natural gas vehicles in your corporate fleet. What does all this equal, in terms of energy-related costs at AT&T? JOHN SCHULZ: Thanks for asking because we’ve talked a lot about our customers, and obviously, we’re very, very customer-focused in delivering a great experience. We realized we need to take care of our own shop. We’ve got to lead by example, and so that’s what we did. It’s a challenge when you have a company as large as we are, over 230,000 employees, we connect over 3 million people around the world, it’s a big operation. Where do you start? It’s pretty daunting, so we started with our evaluation of our greenhouse gas emissions. We did that for the first time in 2008, and we realized we’ve got a couple big hitters. You mentioned them. It’s energy and it’s fleet. These are big areas of opportunity for us, big areas of focus. So, we got after them. We got after those two sections, in particular. For fleet, you’re right. We’ve made a lot of progress here. We have over 70,000 vehicles, and they do a lot of work for us. A lot of times, people just see our vans running down the road. It’s a big part of what we do, going to service our customers, going to make sure the network is working. Those 70,000 vehicles, we took a laser light focus on those things, and we said, “We’re going to make a big play here.” A couple years ago, we said, “We’re going to invest $565 million over the next 10 years in alternative-fuel vehicles. That’s half a billion dollars. That’s a lot of money. Already, in gasoline, we’ve saved over $1 million in gas by switching to hybrids, by switching to compressed natural gas van, and we just announced, as you said, van number 4,000 just rolled out onto the street, so we’re making great strides to our commitment that by 2018, we’ll have 15,000 alternative-fuel vehicles. So, we’re really, really pleased with that. We’re making great progress. It aligns nicely with President Obama’s goal. He said we need to transition off of petroleum imports by a third by 2025, and we really think that this is the way to do that, is a way to make that transition. JOHN SHEGERIAN: Besides energy-related costs, how about environmental sustainability? We’re down to the last two minutes, unfortunately, John. Of course, you’re always going to be welcome back because AT&T is doing so much. We want our listeners to really understand because the leadership role that you’re playing inspires all of us, whether it’s just the general consumer or the small business owner. There are other things you’re also working on with regards to environmental sustainability. Can you share some of those things also with our listeners, before we have to sign off today? JOHN SCHULZ: Absolutely. Again, thanks for your time today. We’re big into energy. We announced earlier this year that we saved $44 million last year in energy-related costs. How do you do that? My advice to you is the 10-knuckle stuff is not rocket science. There’s so much opportunity just in lighting and cooling. What really makes a difference with energy is visibility. It’s accountability. We did some efforts to raise the visibility of our performance on sites, and almost made it into a game and a competition. You wouldn’t believe the results that that kind of competition can drive. On energy, there’s a lot of great resources and ideas about what you can do. Make it a game. Make it a competition. Make it visible, and you’ll see great results. The other opportunities I think we’re seeing that are really game changing for us is renewable energy space. We’ve got a lot going in solar and wind right now. I won’t bore you with all those details. You can check it out on the website, as you mentioned. The thing I wanted to highlight, though, is we did a really exciting, innovative deal with Bloom Energy. You’ve probably seen it on 60 Minutes. You’ve seen it all over the place. They are very innovative fuel cells, where you can take natural gas and create clean electricity onsite. We did a big deal with them, 7.5 megawatts, and it’s really going to revolutionize the way we use electricity at our facilities. The last thing I’ll mention is water. Water for us is critical. If you think about water in your daily life, you literally cannot live without it. We recognize that that resource is under strain. We’ve done quite a bit of work with partners like Vanderbilt University, the Pacific Institute, to understand how we use water here within our operations, and really hone in on some of our opportunities to be as efficient as possible. Our internal story, I think, is all pointing in the right direction. What I would say is, again, as a final comment, I just would like to reiterate we’re all about meeting our customer expectations, making sure the have a great experience, and really helping our community in environmental, social ways, however it is, to make sure that they’re beneficiaries from the hard work we put into making our network as robust as it can be. JOHN SHEGERIAN: As I said before, John, you’re always going to be welcome back here because there’s so much more to the AT&T sustainability story, and our listeners need to hear it because it is so inspiring. For our listeners out there, though, to learn more about AT&T and sustainability before John comes back on again, please go to www.att.com/csr. John Schulz, you are a proven sustainability leader, and truly living proof that green is good. JOHN SCHULZ: Hey, John, thank you so much for having me. I really had a nice time.