More than 45,000 Verizon workers are striking this morning, causing the telecommunications provider’s stock to drop slightly. Others are concerned about what the strike could mean for telecom equipment vendors, but a better question might be how much will Verizon’s legacy employees drag down the company as it competes against more modern I.T. companies? The line between computing and communications is blurring, and Verizon is clearly aware of that, as it focuses on faster broadband, pay TV and also cloud computing.
However, the company has a rich past that stretches back decades. Heck, its previous CEO was a former lineman who actually spliced cables for telephone wires. The striking workers, who are responsible for maintaining Verizon’s wireline telephone network as well as its fiber-to-the-home FiOS network, are being asked for the usual share of rising healthcare costs, but also that they become more flexible. As Verizon’s wireline DSL business shrinks, the company is still supporting an expensive workforce that’s responsible for a business that may soon represent a much smaller portion of Verizon’s profits.
Verizon is competing now against companies such as Amazon and Rackspace, which don’t have unionized workers, and against pay TV providers which sometimes do. As Verizon gets more digital, mobile and cloud-focused, its culture has to shift from one where a person has a single job for 40 hours a week with set time off to one where people work all out to deliver services and innovation for decent paychecks or the chance to take home a piece of the pie. There’s plenty of room for debate over whether this is a good thing, but it’s certainly the thing that Verizon has to adjust to. Will its workers let it?