Verizon’s CEO on Peak Traffic, Cybersecurity, and Leading a Team from Home

Verizon’s CEO on Peak Traffic, Cybersecurity, and Leading a Team from Home

by Adi Ignatius - April 03, 2020

Hans Vestberg is running a $132 billion multinational company at the front lines of Internet and voice connectivity during this extraordinary Covid-19 pandemic, and he’s working from home like the rest of us. “We’re camping out here,” says the CEO of Verizon Communications from his New York City area home with his wife and two children, who are now attending school online. The Swedish national has been at Verizon for three years, previously serving as CTO. Before that, Vestberg was CEO at the big Swedish telecom Ericsson.

When I spoke to him by phone this week, he said he’s using “all the technology” to run his company as normally as possible during these times. In the United States alone, the traffic on Verizon’s mobile and broadband networks has blown way past the peak records set before social distancing was in effect. What follows is an edited version of our conversation.

This is a challenging time. How’s your team holding up?

Spirits are pretty good, despite the tough situation. We know that we serve a mission, first to see that our employees are safe and healthy, and secondly, to see that all the connectivity and networks are up. Our infrastructure is one of the most important in these times of crisis. There are hundreds of millions of people relying on our network across the globe, and here in the U.S. of course.

How are you adapting your leadership style during these difficult times?

My leadership philosophy is just accentuated in a crisis like this. I talk to all 135,000 employees at noon every day on a live webcast. Usually, some 40,000 to 50,000 people tune in live. We need to have transparency and communication in these times. So we go over everything that’s happening in the company, all the new rules, all the guidelines we’re giving out.

I talk to my leadership team every day between eight and nine for one hour. I also keep on me the names of some 45 people that are totally crucial for the success of Verizon. I see that I talk to them every week. And then, of course, I have my board that also needs this same attention with higher frequency in times of uncertainty. I had two virtual meetings with them last week.

Can the infrastructure handle this surge of communications and Internet usage?

Right now in the U.S., Verizon customers are making 800 million calls a day. That’s double the amount of the highest peak during a typical year, which is Mother’s Day. Secondly, the duration of the calls is 33% longer. We also have roughly 9 billion messages on our network in the U.S. each day. That’s the same as New Year’s Eve. And this is constant.

On top of that, the applications people are using have changed dramatically. On our networks, gaming is up 100%. People connecting from home to their company’s office over a virtual private network is up almost 50%. Web browsing is up 20%.

And finally, we can see on our mobile network when people go between different radio towers. That has gone down roughly 27%, meaning that people are moving around much less.

We have seen no major impact from a network point of view, the wireless, the wireline, or the fiber network. That’s very important. The network is robust. We are prepared for it.

Has anything surprised you?

It hasn’t surprised us how well the network is working. I have to say it surprised us how quickly it moved. All of this dramatic change happened in weeks or maybe less than a week. Clearly, this pandemic is an enormous crisis that we have in front of us and are in the middle of.

You talked about how Verizon is responding for its employees. How is your company responding to consumers? There’s that balance many of us face between when do you charge for your content and services and when do you not charge, because we’re in a difficult situation?

Yeah, it’s a very delicate balance. But I have to say, you need to support the most vulnerable in our society in these times, especially if you’re the size of company we are. We are waiving all late fees and suspending terminations for nonpayment in order to keep our small business, enterprise, and residential consumers running. For our wireless consumers, we have automatically increased data limits by 15 gigabytes per month. You don’t need to apply. We just give them more. We’re also prioritizing data and communication of first responders and hospitals.

On the content side, we are giving away free education on the network. We are giving away premium movies. We’re trying to do whatever we can do to make this moment less complicated.

A lot of us have noticed in our video communications that sometimes it works really well, sometimes it doesn’t, sometimes there’s lag. Do you have any advice for those of us who are now living basically on video conferencing?

Yeah, you’re right. Peak hours have changed dramatically. Today, peak hours for home broadband and the wireless network are in the mornings and during the day. That wasn’t the case before. And network usage is now going down on weekends when it has usually gone up.

The other thing to think about if you work from home is that many meetings always start on the clock, on the hour. More companies are now starting their meetings at 10:15 or 11:20 to avoid the congestion getting into the network at the same time. But so far, again, our network is robust and it’s working in this environment.

With the heightened and urgent dependency on our communications infrastructure, what is the risk of disruption due to security threats, particularly as we’re pushing toward peak capacity?

To be honest, I think the peak mode is not the security risk here. All the risk is in the changed patterns. Much of corporate traffic, for example, has been at the office in the past. Now many company employees work from home or even on unknown Wi-Fi networks. That is posing a bigger cyberthreat at this moment.

We serve 98% of the Fortune 500. That is a constant discussion I have with many of the corporations about how you secure that.

I think a lot of leaders now in this difficult economic time are trying to balance keeping their core business healthy and employment up to the extent that they can, versus doing R&D and investing for the future. At Verizon, how are you handling that balance? Have you had to derail some long-term projects just to get through this crisis?

No, we actually have done the opposite. We had guidance for 2020 to spend $17.5 billion on our networks during 2020. Two weeks ago, we decide to increase that to $18.5 billion. I think it’s very different for different industries. In our case, we felt we can invest more at this time. And we think it’s good for employment and for people, and we have that responsibility.

In terms of revenue growth, how do you think this epidemic will impact Verizon overall?

It’s too early to judge. We are three or four weeks into this. Remember, we’re different businesses, all the way from Verizon Media Group with all the Yahoo! assets to Verizon Business Group, serving large corporations, small and medium businesses, and well as the government, to the consumer business. Each may see a different impact. We saw in the first unemployment numbers out last week that clearly this will have an impact on our economy and the future of several countries and on the whole world. But it’s too early to say anything about the impact on Verizon.

What are the biggest changes or trends that you expect to see from consumers, both individual and corporate, post-pandemic? Are there things happening right now during this crisis that might hasten permanent trends?

One of the biggest societal impacts we will see is that people will find new ways to work. They actually found out you can work from home. You can be more flexible. But it also requires another way of communicating, because you don’t have that direct physical contact with people.

Of course, that change will not happen for everyone. Some work cannot be done from home. But that will be a long-lasting change. People will reassess their given core ideas about how to live their lives.

I also think people will be much more cautious about viruses in the future. Because this is such a big crisis, and it’s going to impact so many people, it is going to sit in people’s heads for generations. That’s going to change our behavior, for sure.

Adi Ignatius is the editor in chief of Harvard Business Review.