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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Light Reading. 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. Related posts: T-Mobile confirms layoffs but won't discuss numbers T-Mobile's jobs pledge smells fishy Deutsche Telekom job cuts hit 20K since 2015 as pace ratchets up AT&T to shed 4,700 jobs as part of $6B savings plan, says labor union Telco staff face crisis as cuts claim 127K jobs at big CSPs since 2015 — Iain Morris, International Editor, Light Reading
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