By Michael Martin
Network World, 12/24/01

One of the keys to surviving in the depressed telecommunications market is to build mass. More customers equal more services revenue, which is crucial when the capital market barons are keeping a tight eye on their wallets.

Few telecom executives know more about building mass than Ivan Seidenberg, co-CEO of Verizon - and merger master extraordinaire.

Seidenberg, 54, began his telecom career more than 30 years ago, toiling as a cable splicer's attendant at New York Telephone so he could attend school at night. His dedication has never faded: Seidenberg has stayed with the company his entire career. Granted, the company has changed in ways that Seidenberg could never have imagined as a young outside plant engineer.

In 1996, as CEO of Nynex, the regional Bell operating company serving New York, Seidenberg forged a merger with fellow Baby Bell, Bell Atlantic, to create a telecom giant that would dominate the local voice services market in the northeastern U.S. Two years later, as Bell Atlantic CEO, Seidenberg drove a merger with local and long-distance provider GTE.

In 1999, Seidenberg led efforts to combine the wireless voice businesses of Bell Atlantic, GTE and Vodafone AirTouch into Verizon Wireless.

Now, the ambitious Seidenberg is concentrating on making Verizon a long-distance powerhouse by winning Federal Communications Commission approval to offer long-distance services in states where Verizon is the incumbent local carrier.

Building consensus, delegating authority

Seidenberg didn't get to where he is through bluster and bravado. "He's a consensus builder," says Blake Bath, a senior telecom analyst with Lehman Brothers. "All of the mergers of different companies and different cultures requires power sharing and consensus."

Nothing illustrates this point better than Seidenberg's power-sharing arrangement with former GTE CEO Charles Lee. Co-CEOs often have trouble working together, but no rifts have appeared at Verizon.

In addition to being a consensus builder, Seidenberg is a delegator. He readily hands off responsibilities to his subordinates. "He expects his senior team to run their business units as if they were CEOs," says Peter Thonis, executive vice president for external communications at Verizon.

Again, Seidenberg's style fits the situation. Some of Verizon's business units are billion-dollar operations and one executive couldn't possibly micromanage the entire company.

But Seidenberg can be hands-on in demanding situations, such as when Verizon is dealing with the federal government on telecom regulation. He frequents Washington, D.C., power spots to deal with senators, congressmen and the FCC, Thonis says. He's got "low-key charisma," Thonis describes.

Ever the advocate

Federal regulation and competition are two issues close to Seidenberg's heart. And he's not one to miss an opportunity to hammer home his points on them. Soon after the Sept. 11 terrorist strikes, Seidenberg outlined what he thought telecom executives and regulators should focus on in the wake of the attacks. His main argument was one you'd expect from a man who is leading an RBOC's charge into long-distance and a company determined to spread its influence.

True competition, he argued, should require service providers to invest in network technology so they can increase the number of diverse facilities. Forcing incumbent carriers to resell elements of their own networks to competitors discourages new investment. What's more, he said, large, national carriers are best-suited to respond to disasters such as the attacks because they have the resources and capital for quick and effective reaction.

In Seidenberg's mind, telecom policy should create more incentives for competitive providers to build out their networks and for all providers to roll out more broadband services to consumers and businesses.

With many competitive carriers reeling in the economic downturn and Verizon steadily ramping up its long-distance efforts, it might appear that Seidenberg doesn't have many challenges left. But Seidenberg does need to heighten Verizon's data efforts, particularly on DSL and wireless, Lehman's Bath says.

And he needs to find ways to generate more cash to compensate for the company's highly leveraged balance sheet, Bath says. If not, Verizon might find it hard to make any acquisitions.

Of course, with Seidenberg's track record and ambition, it would be foolish to bet against him. In 1994, back in the Nynex days, Seidenberg said he would rather have 10% of the world telecom market than 100% of the northeastern U.S. market.

It would appear that he's well on his way.