Verizon Communications (VZ) said Chief Executive Lowell McAdam will step down effective August 1 and will be replaced by Hans Vestberg, a former Ericsson (ERIC) executive who joined the company in 2017 as president of global networks and chief technology officer.
Vestberg, the former CEO of Ericsson AB, joined Verizon a little more than a year ago, bringing vital network experience.
The appointment of Hans Vestberg indicates that the key strategy of Verizon, the number one telecom operator in the USA, will be in the building up of 5G, the next-generation of wireless network and not expanding into media content, Reuters reported.
"I am humbled to be appointed CEO of Verizon at such an exciting and dynamic time for our company and industry", Vestberg said. Lowell McAdam will be remaining as the non-executive chairman of the company.
McAdam will step down August 1 and will remain on as executive chairman of the board through 2018. Stratton, president of global operations, will retire this year.
Vestberg previously ran telecom company Ericsson AB, before an ouster in 2016. Since that time, Verizon has made more than Dollars 120 billion in capital investments, in addition to AWS, Straight Path and other spectrum purchases, and pursued an M&A strategy focused on mobile, media and broadband services.
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Vestberg is also one of the founding members of the International Telecommunications Union (ITU) Broadband Commission for Digital Development. Verizon's says it has returned more than $54 billion to shareholders in cash dividends since 2011.
His appointment comes as Verizon and other wireless carriers are racing to develop a 5G network that would deliver faster speeds. The company also acquired 45 percent of Vodafone's $130 billion stake in Verizon Wireless, now the biggest technology deal of all time.
Verizon's stock has grown about 35% in McAdam's tenure according to the Wall Street Journal, better that AT&T.
Verizon's choice of Vestberg may signal the company plans to retain focus on network improvements, rather than secure deals, a t a time when other rival companies have looked to deals to diversify their businesses, Bloomberg reported.
Verizon has shown how serious it is about 5G.