Verizon seeking to cut costs
Verizon (VZ) is planning to cut ~800 jobs in its media unit, which would result in the unit’s workforce decreasing by ~7.0%. The planned media job cuts will be in addition to the nearly 11,000 jobs Verizon is eliminating company-wide via the voluntary early retirement program it announced last year.
The workforce reductions at Verizon are linked to the company’s goal to save $10 billion in costs by 2021.
Funding 5G projects
Verizon is expected to funnel some of its savings toward the funding of its 5G network buildout projects. In October last year, Verizon began offering 5G services in a handful of cities in the United States. Its rival AT&T (T) followed suit with a 5G service rollout in a dozen cities. On their parts, T-Mobile (TMUS) and Sprint (S) are seeking to merge to allow them to pool their resources to speed up their 5G network rollout across the United States. Last year, T-Mobile signed Nokia (NOK) and Ericsson (ERIC) for $7.0 billion in 5G-related contracts.
Capitalizing on 5G connectivity
As 5G-compatible handsets are expected to start arriving on the market in the coming months, operators such as Verizon are busy working on expanding their 5G network coverages. The arrival of 5G connectivity is expected to create new revenue opportunities for operators, especially in the enterprise market. A study by Ericsson predicts that there will be 1.5 billion 5G subscribers globally by the end of 2024, with North America leading in terms of 5G adoption.