Telephone Excellence by Mike Mitchell

TELECOM and the ECONOMY - Part I
By Mike Mitchell

Much is being written about the economic hard times this year. Calls for the government to do something are heard everyday. The presidential candidates are consistently hounded by reporters demanding a magic bullet to rejuvenate the economy. There is little doubt that mistakes have been made by the elected leaders in Washington, D.C. but is there more to the job loss and struggling economy than meets the eye?

The Downside of Telecom
• Matthew Flanigan, president of the Arlington, VA. based Telecommunications Industry Association which represents telecom-manufacturing companies, states “Among my companies about 600,000 jobs have been lost.”
• The Nashuatelegraph.com reports that Verizon has completed voluntary layoffs to reduce the workforce by 10%.
• According to The Economic Times, Embarq Corp, the fourth-largest US traditional telephone company with service in 18 states will cut about 1000 employees and contractors which is about 3 per cent to 4 per cent of Embarq's work force of more than 17,000.

The telecom industry has been plagued by job loss and struggling companies since 2002 when WorldCom filed for Chapter 11 (the largest such filing in United States history until Lehman Brothers in September 2008). Even with all the negative news, there is hope on the horizon.

The Upside of Telecom
• McClatchy-Tribune Information Services reported that although the weak economy has hurt many companies, MetroPCS Communications Inc. saw its net subscriber growth more than double during this year's third quarter. Customer totals jumped by 249,265 during the quarter to 4.85 million. Over the last year, MetroPCS has added about 1.2 million customers.
• The New Jersey Business and Industry Association saw new trends emerging over two years ago when it reported that “In the telecom sector…Most of the telecom losses have come from the heavily regulated wired sector, but these losses are being offset by growth in wireless technology, fiber optics, and voice-over-the-Internet protocol.”
• Louise Goss-Custard, a managing director at recruiting firm Russell Reynolds, says that 60% of human-resources managers at 35 large telecommunications companies she recently interviewed believe the industry has begun to recover from the [industry] woes….translating into a small but steady stream of new job postings, particularly from start-up companies, companies emerging from bankruptcy or those in hot new areas like wireless communications, voice-over Internet telephony and 'wi-fi', or wireless computing.

What is really happening to Telecom?
Change is inevitable. Change is also uncomfortable and often painful. Without change, industries, products and services fade away leaving only memories, both good and bad. Telecom has changed and continues to change. Just like the four pound gym bag sized mobile phones seem prehistoric compared to Apple’s iPhone, the Telecom industry is always pushing aside the past with an eye for innovation, emerging markets, and satisfying current demands.

In Part II I’ll explain at least one reason for the current economic situation and what’s driving the demand for the next hot technology or got-to-have products in telecommunications.

-Mike