Verizon Job Cuts Just Keep Coming
26,000 since 2008, 13,000 more this year...
Sure, Verizon is losing a significant number of customers due to the slow but steady death of traditional copper-based phone service, and the economy isn't stellar. But Verizon's also making a very conscious decision to hang up on large swaths of rural America
so they can focus primarily on selectively-deployed FiOS service and wireless. That refocus is accompanied by a significant number of job cuts. The company has cut 26,000 jobs over the last two years, and yesterday told attendees of their earnings conference call that many more cuts are coming
Verizon CEO Ivan Seidenberg said on the company's quarterly earnings call Tuesday that it will slash about 13,000 positions in 2010. The telecom giant previously cut 13,000 jobs from its landline business in 2008 and another 13,000 again in 2009.Verizon's total headcount at the end of 2010 was nearly 223,000, with 117,000 employees in the fixed-line business.
More than half of Verizon's revenues now come via wireless, and that number is expected to grow as Verizon embraces new plans that incur high consumer overage charges
. The company is making it pretty clear that they're no longer interested in DSL service. In addition to slowly jacking up the price of DSL service, there's a long list of state regulators
who claim Verizon is only getting worse when it comes to supporting existing DSL and copper-based voice customers. Union workers continue to complain they aren't getting the resources they need to support existing customers, and it doesn't look that's going to be changing in 2010.
Yes, Verizon's running a business, and refocusing their attention on more profitable ventures is a no-brainer. The problem is the company still has millions of customers using Verizon services on networks that were propped up by taxpayer assistance. These users are either being neglected, or they're being sold off to companies using sophisticated financial deals
that deliver millions in tax-savings and debt-reduction to Verizon, but which saddle the buying companies with mountains of debt. That debt means no network upgrades
, and in the case of at least two Verizon DSL sale partners, bankruptcy.
While the economy gives Verizon a justification for the layoffs (execs conveniently insist they don't see economic improvement in the cards until 2011), in reality Verizon's engaged in a complete business overhaul that also has very real human costs. What happens to huge swaths of Verizon customers on taxpayer-subsidized networks Verizon is no longer interested in owning (and the workers who maintain them) should be one of the bigger questions of 2010.
Verizon was NOT taxpayer subsidized
millions of customers using Verizon services on networks that were propped up by taxpayer assistanceI see the above often repeated. But it is a distortion of what really happened. Verizon was never taxpayer subsidized. They were once rate regulated by state PUCs that were very generous in determining what Verizon was allowed to charge their customers. Tax money was not funneled to the company like is often implied. It was merely a regulatory system that was broken and where most customers were better of when it was deregulated somewhat.
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13000 job cuts... out of a company with 223,000 employees barely covers the number of people who will leave anyway through retirement or normal attrition. What the company is saying more or less is that they aren't going to be refilling those positions.
And, I'm really not sure I understand or concur with this point about their customers on older networks being neglected. What..they go out of service and no one comes to fix it?
Of course that's not the case. If what is meant is that verizon isn't spending the money to upgrade old technology with more old technology..who can blame them? It seems to be a case of damned if they do and damned if they don't. The company has been very aggressive at rolling out fios and spending a lot of money on next generation networks and now they'd like to see some return on their already huge investments. Again..who can blame them?
I predicted up to two years ago on this site that things would be getting VERY difficult for the telco's both with loss of landline customers..dsl customers..and huge expense in rolling out next generation networks. And..at the same time..predicted cable co's like Comcast would be wasting no time eating their lunch by rolling out d3 networks and growing their phone business via triple play bundles. My predictions have all come to pass. At the same time I praised verizon for doing the right thing and spending the money needed to compete but said that didn't insure their survival even...just that they were doing what they could with a very difficult situation.
I just don't think they can be faulted now for doing exactly that...and should be praised instead for taking the bull by horns and trying to wrestle with it. What I DON'T think they should do however..is to stop or even slow down their fios rollout.
It really is their only last hope and even if they aren't seeing all they expected too..they really need it in order to compete in the future. If they don't..they will continue to do nothing except lose more dsl customers..not have tv to compete in many areas..and continue to lose landline customers. Wireless alone will not sustain them in that case.
In any event..I think that given the whole scenario and what they've faced..13k jobs that would be lost anyway through attrition is a drop in the bucket. And the complaints about their not spending huge money on old networks is unwarranted...and unfair.
Verizon has done a lot in a very difficult enviroment. And with what may wind up being an impossible predicament they found themselves in.
The time has come for the cable co's to rule. And Comcast has shown what they could do in a very short amount of time with rolling out a nation of D3 networks.
Life is tough for the telco's for sure.
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Re: 13000 job cuts... I pretty much agree with what you say. I hope Verizon is cutting back wherever they can in dead markets and expanding for the future which I guess is FIOS and wireless.
A boss of mine once told me that the most difficult thing to ensure success in business was to change with the market place. That guy turned a $10 million business into a $60 million business.
The US auto industry is an example of not changing with the times and refusing to cut back (undeniably fighting the unions) and look where it is today.
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| |said by Rick:Tell that to the laid off workers. I know of at least 11 in my building. Yes, they also aren't back filling positions. You might notice people now complaining about phone outages not getting fixed for 2-3 weeks. DSL outages that last far longer than they did a couple years ago. It use to be they expected a DSL outage ticket to be picked up in five minutes. Now many sit in the pool for hours. I bet Ivan's bonus is going to look great this year.
out of a company with 223,000 employees barely covers the number of people who will leave anyway through retirement or normal attrition. What the company is saying more or less is that they aren't going to be refilling those positions.
RIP my babies Buttons 1/15/94-2/9/07, Beamer 7/24/08, & Bows 12/17/94-10/11/09
| || Dear Rick, Please read the article again. The corporation presents their statistics in order to give you the wrong impression. What is not said is that all of the job cuts are on the wire line side. They are cutting 13,000 jobs but out of the 117,000 wire line division, not the 223,000 total. That's an 11.1% reduction. Verizon Wireless never lays anyone off. Their turnover rate is so high that they will never have to. And there were 13,000 cuts in 2009. And there were 13,000 cuts in 2008 also. These are not levels of normal attrition at all. And as a wire line employee, I can assure you that almost everyone who is eligible or can afford it has already retired. These are 13,000 layoffs that we are talking about here. And it's not for lack of work. It's also an inside secret that Verizon Wireless dumps a lot of it's costs on to Verizon Telecom to make wireless appear more profitable to investors than it really is. Many people don't know that most cell towers still work through copper land lines. The others are simply relay towers. And all functions of government and emergency response including 911 still use copper land lines. The copper network IS being neglected, trust me. As the article said, they are neglecting millions of customers that they still have an obligation to. If a cell tower goes out of service it is obviously a top priority, but residential phone and DSL customers are waiting way to long for repair service. Thank You|
Verizon IS making cuts into the bone As a recently laid off Tier 3 Verizon Business tech. that has been laid off in the last round, I can state:
They are laying off transport tech's that have 13+ years of experience with the fiber rings, and keeping the younger and less knowledgeable tech's.
The layoff decisions are based on the bean counters, and have nothing to do with MTTR (Mean time to repair) So, the customer suffers. I knew the large metro area network like the back of my hand, and could troubleshoot and repair a fault faster than any other tech.
My measured results in the proprietary install/ticket tracking system showed me as the top tech.
If they cared about the "network" I would have been the last one to get a pink slip. Yet, they kept people that don't know how a DWDM works, much less even know how to log into half the Sonet equipment used in the network.
To make matters worse, as they swallowed MCI, Worldcom, and several other smaller companies, they have a lot of legacy equipment. Some of witch, I was the only tech left standing with a working understanding of said equipment in this area.
This company only cares about the bottom line, and don't make decisions based on the ability to maintain the network.
I have maintained contact with employees and heard about extended outages, as they needed tech support from tier 2 support, as the business customer maintained an extended outage.
Out of frustration a long time ex-coworker called me and asked for help out of desperation, after he could not get support from the tier 2 support group on a legacy obscure piece of equipment.
I felt sorry for the friend, and NOT the company and walked him through the troubleshooting over the phone "this one time"