The wireless tracking stock is structured much differently than an earlier AT&T spin-off; gear maker Lucent Tecbnologies Inc.

 Lucent, with its own board of directors, went public in 1996 at $6.75 a share and has mostly thrived. Its stock hit a high of nearly 85 late last year, and now trades around 62.

 Lucent, which got the Bell Labs research and development unit, is free to make sales to AT&T rivals, such as the regional Bells

Spin-off VS. Tracking

Some analysts say that spin-offs like Lucent fare better in highly competitive markets than do firms structured as tracking stocks.

"It tends to rev up the entrepreneurial zeal when these firms are on their own," said Joseph Cornell, president of Chicago-based re­search firm Spin-Off Advisors LLC.

"They do what they need to do to get ,' efficient, they don't have to beg the parent firm for anything.".

There may be po­tential conflicts be­tween the interests of shareholders in a tracking stock and the parent company, some analysts say.

Problems may arise how to spend money or new opportunities because the same directors make decisions.

Take General Mo­tors Corp. It issued the first tracking stock, for Electronic Data Systems Corp., in 1984. In 1996, when GM actually spun off EDS, shareholders sued over some financial deal­ings between the firms. GM won.

Robert Wilkes, analyst at Brown Bros. Harriman & Co., also points to US West Inc. The phone company formed a tracker for its cable business, MediaOne Group Inc.

A dicey issue popped up, he says, when both companies could bid for new radio spec­trum the government auctioned off, in the mid-1990s for new wireless services.

"You never know what issues are going to come up," said Wilkes. "The risk you run with tracking stocks is a splintered set of shareholder interests where decisions can favor one group or another."

In AT&T's case, it could face a tough call in how fast to expand "Project Angel." The fixed wireless system, which AT&T is testing in Dallas, delivers Internet access via radio antennas hooked up to houses or businesses.

AT&T says it may spend $350 million this year alone rolling out the fixed wireless ser­vice in a few markets. Expanding that service could crimp the profits of AT&T Wireless, analysts say.

Still, AT&T may face fewer internal squab­bles than rivals, analysts say. Many rivals have formed partnerships that will require much cooperation.

Bell Atlantic Corp., which plans to merge with GTE Corp., this month forged a wire­less joint venture with U.K.-based Vodafone AirTouch PLC. They plan to sell  shares in the venture called Verizon Wireless'.

Regional Bells SBC Communications Inc. and BellSouth Corp. also have formed a wireless joint venture.

Apples don't fall far from the tree, the saying goes. Nor do tracking stocks stray far from their parent company's strategy and goals.

That'll be the case with AT&T Corp., which plans to issue a tracking stock Thurs­day for its fast-growing wireless phone business. (See related industry table, Page A6.)

AT&T will raise from $9.36 billion to $13.2 billion in what in any case will be the biggest IPO ever in the U.S.

The company's cellular efforts will be grad­ed by how the IPO fares amid a recent bloodbath in tech stocks. Many analysts say AT&T will get an "A" if shares rise 10% or so the first day.

The success of the IPO also will be mea­sured by how AT&T Wireless Inc. shares perform vs. AT&T over the next few years, analysts say.

Issuing a tracking stock should help AT&T adapt to a market in which com­petition, prodded by deregulation, 'is rising fast, observers say.

"Tracking  stocks are an effective bridge, a transitional (financ­ing) tool that helps a company get from where it is today to where it wants to be in the new economy," said Barbara Byrne, a managing director at Lehman Bros. Inc.

 "It works in the telecommunications indus­try," added Byrne, head of Lehman's track­ing stock investment banking group, "where you need tremendous sums of money and a lower cost of capital."

'Best Of Both Worlds'

The IPO will give AT&T Wireless more money to build networks and make acquisi­tions, analysts say.

Investors and AT&T both will benefit from the tracking stock, say AT&T execu­tives.

"We get the best of both worlds," said Charles Noski, AT&T's chief financial officer, in a recent interview prior to the self-im­posed "quiet period" proceeding IPOs.

He says that the wireless group will still play a big role in the parent's strategy.

 "We share a common brand, we keep in place the opportunity to bundle services with other parts of AT&T," he said. "At the same time. AT&T Wireless has the ability to pur­sue things with a very efficient currency."

 AT&T, for example, can still package wireless phone service with discounted long-dis­tance rates and super fast Internet access.

 Unlike a total spin-off, AT&T Wireless still will report to the same chief, C. Michael Armstrong, and the same board of directors as does AT&T Corp.

 AT&T's former president, John Zeglis, is the wireless company's chief executive.

 After the IPO, AT&T still will own the wireless business' key assets, such as spec­trum licenses and nationwide network. But the wireless firm will generate its own cash flow and profits.