Verizon has unveiled a new corporate structure in an attempt to make a lean, mean, money-making machine at the dawn of the 5G era.
While many of these announcements are usually coupled with some form of job cuts, there doesn’t seem to be one in this case. We’ve been unable to locate the relevant forms on the Securities and Exchanges Commission website, though considering there have been numerous ‘streamlining’ initiatives already announced, it might be a case of fitting the business around the new headcount.
“This new structure reflects a clear strategy that starts with Verizon customers,” said CEO Hans Vestberg. “We’re building on our network transformation efforts and the Intelligent Edge architecture to deliver new customer experiences and optimize the growth opportunities we see as leaders in the 5G era. We’re focused on how our technology can benefit customers’ lives and society at large.”
The new Verizon business will be organized into three business functions (Consumer, business and Media), supported by a network and IT organization, and corporate-wide staff functions. The consumer group will feature both the wireless and the broadband business units, as well as wireless wholesale, led by Ronan Dunne, who is currently President of Verizon Wireless. The business unit will include the wireless and wireline enterprise, small and medium business, and government businesses, as well as wireline wholesale and Verizon Connect, the company’s telematics business, headed up by Tami Erwin, the current EVP of Wireless Operations. The media unit will essentially be the Oath business, with current CEO Guru Gowrappan in charge. Kyle Malady will lead the network and technology department, while there will no changes to the management team on the corporate side.
While job losses have been an unavoidable topic in the telco world over the last couple of years, Verizon made a pretty weighty announcement last month. In an effort to trim the number of lifers and dead-weight in the management layer, Verizon offered 44,000 staff a redundancy package of three weeks of severance pay for every year worked, though it is not entirely clear how many heads the telco want to count rolling out the front door.
As it stands, Verizon currently employs 153,000 people across its various markets, though this figure was as high as 183,400 in 2012. What is worth noting is that it would be unfair to point the finger of destruction at Verizon alone, the trend is clearly visible across an industry rocked by OTTs, and a North American market which has consistently and aggressively sought to undercut rivals.
With many telcos around the world attempting to take advantage of the convergence trend, perhaps this new structure will offer Verizon a leg-up. The launch of its 5G fixed wireless access business certainly gives the business something to talk about, though with both the consumer wireless and broadband units now on the same branch of the family tree, a more consolidated approach on products, tariffs and marketing can be taken. How this impacts the Verizon message remains to be seen, though an aggressive 5G assault is almost guaranteed with new devices promised over the next 12 months.
Research from RepeaterStore suggests only 41% of US consumers were aware 5G is just around the corner, and while the conversation for many telcos is now focusing on the enterprise side, in the US the 5G p*ssing contest appears to be circling the consumer. With such low consumer knowledge of 5G, the telcos will have to do a considerable marketing push to communicate the benefits of 5G.