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June 19, 2020
Already bruised by "downsizing," "synergies" and even "zero touch," the English language took a further pummeling this week as comms people tried to muffle any mention of staff cuts at T-Mobile US. "Workforce evolution," the latest PR abuse, is not just a hand clamped over the mouth. It's a full-on gagging and abduction job.
It also marked a low for T-Mobile in the post-John Legere, married-to-Sprint era. Looking more like a band roadie than a telco exec, with his shaggy hair and leather jackets, the maverick former CEO excelled at comms precisely because his public utterances were so denuded of jargon. "What a stupid, broken, arrogant industry," he once said. AT&T and Verizon, his big rivals, were regularly lampooned as "Dumb and Dumber." Orthodox he was not.
How disappointing, then, to read a statement from the self-styled "Uncarrier" that smacked of the faceless business determined to smother bad news with the dirty rag of euphemism and prevarication. Responding to reports about cutbacks, T-Mobile said it was "working to rapidly evolve and transform our workforce into an even more effective and efficient team."
Five thousand new jobs would be created, it blathered on, before eventually mumbling that an unspecified number of employees "will be supported in their efforts to find a new position outside the company." At least, thankfully, it didn't say they would be "transitioned."
It is hard to imagine this under Legere. But then, it is hard to imagine Legere at an operator that increasingly resembles one of the corporations he used to mock. From the owner's perspective, too, Legere was an asset when T-Mobile was a pugnacious upstart kicking the shins of its bigger rivals. As the boss of a more mature firm with some difficult, grown-up decisions to make, he could have been a liability.
The subject of layoffs, the blunt expression Light Reading prefers, is the ultimate taboo for T-Mobile. Back in April 2018, when parent company Deutsche Telekom was persuading US regulators to bless the Sprint marriage, CEO Timotheus Höttges said: "The overall plan is for the larger company to employ more staff than the two previous companies put together." This pledge was important in overcoming resistance to the sort of deal that would typically claim jobs.
It always seemed strange, though. Companies don't merge with their rivals only to maintain parallel functions at the expense of their margins. Deutsche Telekom was also looking for about $6 billion in cost savings, including $4 billion in networks, $1 billion in sales, service and marketing activities and another $1 billion in the back office.
While this week's press release fell victim to comms professionals, a filing with the Securities and Exchange Commission (SEC) made off with some details. Previously, T-Mobile had expected to incur merger-related costs of between $500 million and $600 million this quarter. It now anticipates costs of between $800 million and $900 million, said the filing, mainly because of more "severance," a word the author of "workforce evolution" would not have wanted to survive.
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What this evolution means will eventually become apparent in other SEC filings and company reports, including data that Deutsche Telekom usually publishes in its own earnings statements. The number to watch is 80,000, the rough count of employees at the new-look operator, according to a company spokesperson. T-Mobile had 53,000 employees at the end of last year, having gained 3,000 since 2016. Sprint employed 28,500 people in December 2018, when it last disclosed the figure. That was about 1,500 fewer than it had a year earlier.
Communications Workers of America, a trade union, previously reckoned about 30,000 jobs would be at risk if a merger went through. But it would take far less scything to leave T-Mobile with fewer than 80,000 employees if it is creating only 5,000 new roles.
Whether or not it shrinks, full transparency this week would have been the real "Uncarrier" way. Disclosure of the planned cuts would be damaging, rather than just awkward, only if they prevent Deutsche Telekom from upholding its pledge. Regardless, the truth will eventually out, as the saying goes. This week's abuse by T-Mobile will only make it sound worse.
— Iain Morris, International Editor, Light Reading
International Editor, Light Reading
Iain Morris joined Light Reading as News Editor at the start of 2015 -- and we mean, right at the start. His friends and family were still singing Auld Lang Syne as Iain started sourcing New Year's Eve UK mobile network congestion statistics. Prior to boosting Light Reading's UK-based editorial team numbers (he is based in London, south of the river), Iain was a successful freelance writer and editor who had been covering the telecoms sector for the past 15 years. His work has appeared in publications including The Economist (classy!) and The Observer, besides a variety of trade and business journals. He was previously the lead telecoms analyst for the Economist Intelligence Unit, and before that worked as a features editor at Telecommunications magazine. Iain started out in telecoms as an editor at consulting and market-research company Analysys (now Analysys Mason).
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