Verizon Gets a New CEO as the Race to 5G Heats Up

CTO Hans Vestberg will replace Lowell McAdam

Vestberg will become the company's new CEO in August.
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Verizon is tapping a new leader as it heads toward a pivotal juncture in the future of wireless service.

The country’s biggest cell carrier announced on Friday that its current chief technology officer, Hans Vestberg, will succeed CEO Lowell McAdam in August.

The move seems to suggest Verizon is placing more priority on the fast-approaching rollout of its high-speed 5G networks and perhaps less on its ambitions to build a digital media empire under McAdam.

As the company’s technical chief, Vestberg oversaw implementation of Verizon’s 4G LTE and FiOS broadband coverage and drew up the plans for 5G deployment. He joined the company in April of last year after serving as CEO of Swedish telecom Ericsson for six years.

Verizon is expected to start rolling out high-speed residential 5G service to certain customers in 11 U.S. cities this year and has vowed, along with AT&T, to be the first to install a mobile version as well. Experts say the technology will eventually cut download speeds exponentially and enable connected devices to communicate instantaneously.

In addition to the cutthroat race between Verizon and other U.S. telecoms, the industry is facing huge pressure to catch up with competitors overseas who may be further along in the 5G installation process. A recent study ranked the United States third in 5G preparedness behind China and South Korea.

Vestberg seemed to allude to 5G as a top priority in his statement Friday.

“We are experiencing unprecedented changes in the way users interact in the digital world, and we are racing ahead to remain at the forefront of technology, connectivity and mobility,” he said.

McAdam, who’s served as chief executive since 2011, grabbed headlines throughout his tenure with major digital content deals that brought properties like AOL and Yahoo under Verizon’s umbrella. He’ll stay on as chairman through the end of the year.

“As I think about the power of 5G, I am convinced that this is a significant and pivotal time for Verizon and our entire industry—and now is the time to bring Verizon into its next chapter,” McAdam said in a memo to employees on Friday.

Gartner telecoms analyst Eric Goodness said Verizon’s digital content business will likely take a backseat to network needs like 5G under Vestberg.

“5G and all-things network-centric (such as service orchestration and automation) are the company’s focus. Any thoughts on VZ expanding beyond a network player are likely to be de-emphasized,” Gartner said in an email.

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