Thread regarding Verizon Communications Inc. layoffs

Sea-change in the cellular industry

There’s been a sea-change in the cellular industry since the introduction of the iPhone. Years ago the industry was profitable and growing. Feature phones were roughly equivalent, cheap to make and none of the vendors had pricing power. If Motorola tried to overcharge, companies could strike a better deal with Samsung or any other competitor. The vendors and the employees benefited from this rising tide.

Fast forward to today and smartphones have impressive capabilities but are much more expensive and brand loyalty means companies like Apple have pricing power. At the same time the increase in data consumption has required much larger investments in cell sites and spectrum. As a result, service providers are squeezing their suppliers and their employees as hard as they can to remain profitable. Sure, Lowell, Hans, and company made huge mistakes but the overall change in the industry is equally important if not more so.

I don’t foresee an improvement in this trend and I think it’s no longer worth it for those of us who aren’t ED, VP, or CEO to remain in this industry.


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Post ID: @OP+1m2wv92q3

5 replies (most recent on top)

@a4 dont run from competition embrace it, dont worry about immigration, its just healthy competition. Dont worry about DEI, get a tan. Embrace lower wages, increased housing, food, education, insurance, medical cost, etc. it’s just competition. Don’t you like competition? Yes, when it’s not being manipulated like the hunger games. Do you really want your children to live worse than you?

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Post ID: @cn+1m2wv92q3

@ Here’s the big picture: The cost of operating the network has increased. The cost of subsidizing devices has increased. The company hasn’t figured out a way to increase profits or market share so they’re relying on cost cutting measures including layoffs to maintain profitability. The same scenario is playing out at T-Mobile and AT&T. It makes more sense to work in an industry that’s growing. That’s all!

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Post ID: @cf+1m2wv92q3

@bp Huh?!? “Get four iPhones on us” is definitely a subsidy. Smartphones cost more to make than feature phones because they’re more complex and have more expensive components: screen, battery, RAM, storage, battery.

My point was that subsidizing smartphones is more costly than subsidizing the feature phones of old and I see that trend continuing.

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Post ID: @cd+1m2wv92q3

Smart phones didn't become more expensive (per se)--the carriers stopped subsidizing them. Starting with TMUS, then the rest followed.
Equipment subsidies were becoming a very large chunk of OpEx and as I recall, VZ was pretty happy to eliminate them.
Apple has always had market power, stemming from AT&T's exclusive deal (I think that was for four whole years) until VZ was able to start selling. Apple build pent-up demand and it all went downhill after that :-)
Who remembers the 'famous' John Oliver rant?

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Post ID: @bp+1m2wv92q3

Disagree.... actually the opposite. Stay and leverage experience as competitors will be bundling services and huge upside with Cable Companies etc to cross leverage skill sets.

Don't run from competition.. embrace!

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Post ID: @a4+1m2wv92q3

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