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Exec Pay: Who makes what in wireless?

Wed, 12 Mar 2008 07:59:59 -0400

Exec Pay: Who makes what in wireless?

Few issues stoke the ire of workers like executive pay. The average CEO of Standard & Poor's 500 company list made $15.06 million in 2006, which is the most recent year for executive compensation figures. The ten U.S.-based, public wireless company CEOs whose pay we tracked averaged about $18.34 million in 2006. Only half of them are on Standard & Poor's 500 list.Ã‚Â

Because every company has their own nuanced approach to executive compensation, we tried to make it easy and follow the new 2006 rule that the SEC requires public companies to disclose total compensation, which includes salary, bonus and "other" compensation. The "other" compensation category includes vested restricted stock grants and "stock gains," the value realized from exercising stock options during the past fiscal year.

Just today AT&T announced its executive compensation figures for 2007. Chairman, president and CEO Randall Stephenson, who took over from Ed Whitacre Jr., received total compensation of close toÃ‚Â $22 million. President and CEO of AT&T Mobility Stanley Sigman received compensation of $36.9 million, before he retired at year-end. Ralph de la Vega, who took over for Sigman, received $12.4 million in 2007.

Whether it was because of retirement or a forced resignation, some of the CEOs in our top ten list--Sprint Nextel's Gary Forsee, Motorola's Ed Zander and AT&T's Ed Whitacre Jr.--are no longer at their posts. Take a look back at what these executives and their still-gainfully-employed colleagues made back in 2006. How much does it cost to retain a wireless leader? Here are ten answers that brought varying degrees of success. Click here to see the start of the report, or select a name below. -Brian

Ed Whitacre Jr., AT&T CEO

Paul Jacobs, Qualcomm CEO

Ivan Seidenberg, Verizon CEO

Gary Forsee, Sprint Nextel CEO

Scott Ford, Alltel CEO

Ed Zander, Motorola CEO

Mike Zafirovski, Nortel Networks CEO

Michael Gallagher, FiberTower CEO

Doug Hutcheson, Leap Wireless CEO

Steven Dussek, Dobson CEO

Forsee to lead U. of Missouri; Hesse paid $1.2M

Thu, 20 Dec 2007 06:59:55 -0500

According to a report from the Kansas City Star, former Sprint Nextel CEO Gary Forsee is set to take the helm of the University of Missouri system of schools. The appointment marks the first time the university would have a president without a background in higher education.

Meanwhile, newly appointed Sprint Nextel CEO Dan Hesse will reportedly make $1.2 million a year at Sprint. Sprint gave Hesse a $2.7 million cash signing bonus and 3.3 million stock options. Hesse's annual bonus for next year ranges as high as 3.4 times his annual salary, or about $4 million. His contract runs for three years.

For more on Forsee and Hesse:
- read this report from the AP on Hesse
- check out this article from the Kansas City Star on Forsee

RIM posts higher-than-expected earnings

Thu, 28 Sep 2006 20:01:37 -0400

Research In Motion posted higher-than-anticipated earnings, reporting a net profit of $140.8 million and 705,000 new subscribers in the second quarter. That subscriber growth is continuing with an average of 60,000 new users signing up each week during the first three weeks of this month alone, RIM said. Investors didn't lose their enthusiasm for RIM stock even when the company disclosed that it has begun an investigation into how it handled stock options. RIM said it will likely restate earnings to correct accounting errors resulting from a voluntary review. This will ultimately reduce its net earnings since 1997, when it became publicly traded, by $25 million to $45 million. Any changes are not likely to significantly alter current or future results, the company said.

For more about RIM's second-quarter results:
- check out this article from The New York Times (sub. req.)

FBI: Comverse execs gain $8M from backdating

Wed, 09 Aug 2006 20:01:37 -0400

The criminal investigation federal prosecutors launched back in May into Comverse executives' issuance of stock options has reportedly uncovered a slush fund nicknamed "I.M. Fanton", fake employees and manipulated stock option grants. The decade-long scheme allegedly spearheaded by Comverse co-founder Kobi Alexander, CFO David Kreinberg and general counsel William Sorin began to unravel in March after a Wall Street Journal reporter called the company after noticing that the stocks were issued just before low dips in the stock price.

The three execs resigned in early May after allegedly raking in a personal gain of about $8 million from the backdating scheme, according to the FBI affidavit. The affidavit also alleges that Alexander cherry-picked days in Comverse's past stock trading where the price was low and assigned the stock options issuance dates to those times. Sorin then allegedly misled the board members to get them to sign the paperwork.

For more on Comverse's backdating charges:
- see this WSJ article (sub. req.)

Broadcom finds stock-option discrepancies

Thu, 13 Jul 2006 20:01:36 -0400

Chip maker Broadcom said its internal review has uncovered discrepancies in its accounting for stock options grants, finding that certain options awarded between 2000 and 2002 were not actually allocated or had not received formal company approval as of the original accounting date. As a result, Broadcom said it would restate earnings as far back as 2000. None of the stock options were awarded to co-founders, top executives or board members, the company said. Broadcom expects to record an additional non-cash expense of more than $750 million for stock-based compensation for the years 2000 to 2003. The expense will not impact the company's financial condition and will be offset by a rise in additional paid-in capital, Broadcom said.

To read more about Broadcom's re-statement of financials:
- check out this release

Openwave lowers forecasts, reveals stock probes

Thu, 06 Jul 2006 20:01:37 -0400

Yesterday wasn't a good day for Openwave Systems. The company revealed it received subpoenas from the U.S. Attorney for the Northern District of California and from the U.S. Attorney for the Southern District of New York over its stock-options practices and it drastically lowered its fourth-quarter guidance. The news sent Openwave's stock down 32 percent on Thursday. Openwave said it expects a fourth-quarter loss of $0.13 to $0.14 per share on sales of $90 million to $92 million. Wall Street expected $0.22 a share on sales of $122 million.

To read more about Openwave's bad day:
- take a look at this article from Red Herring

SEC to informally petition Broadcom

Mon, 12 Jun 2006 20:01:36 -0400

Broadcom joins at least four other telecom companies as the SEC launches an "informal" inquiry into media and analyst reports concerning the company's stock options granting practices. In March, a report from the Center for Financial Research and Analysis claimed 17 companies were "at risk" for having back-dated stock option grants during the five year period that ended in 2002. Broadcom was among the companies named. "Back-dating" is retroactively altering the grant date of an option so that it coincides with a low-price period in the company's stock price.

For more on the SEC's informal inquiry into Broadcom:
- see this article from Light Reading

SEC probes three more telecom companies

Mon, 22 May 2006 20:01:37 -0400

Three more telecom companies are coming under scrutiny for their stock-option grant practices amid what looks like a wider effort by the federal government to look into how companies grant and perform financial accounting for stock options. Prepaid services provider Boston Communications Group, Openwave and Juniper said they had received inquiries from federal authorities about their stock option grants. BCGI reportedly approved stock-options grants to senior executives three times during a five-year span at the lowest possible price for the calendar year.

For more about the SEC stock-option probes:
- check out this article in RCR Wireless News
- read this release from OpenWave
- check out this release from Juniper

SEC probes American Tower stock-options

Sun, 21 May 2006 20:01:36 -0400

Stock-option grants are coming under more scrutiny. The Securities and Exchange Commission is probing into American Tower's stock-option practices and related accounting. American Tower said it is reviewing the timing and pricing of its pre-2001 stock-option practices and might have to restate some financials. The company said it does not expect the review to result in changes to its revenue, operating expenses or cash flow from operations. Federal prosecutors are looking into the questionable stock-options grants by Comverse Technology that forced the ouster of three top Comverse executives.

To read more about American Tower's SEC probe:
- take a look at this report from Forbes.com

ALSO NOTED: Indonesia issues 3G licenses; Nokia announces LBS for lower-end phones; and much more...

Thu, 09 Feb 2006 19:00:41 -0500

> Indonesian carriers Indosat, Excelcomindo and Telkomsel secure licenses to operate 3G networks. Article

> Nokia announces new LBS services and a GPS module for lower-end phones. Article

> Sprint Nextel gives restricted stock units valued at about $5.7 million and 637,755 stock options to president and CEO Gary D. Forsee. Article

> NBC MOBILE will offer MobiTV's mobile television subscribers highlights of the 2006 Winter Games. Press release

> Standard & Poor's Equity Research lowers its target price on France Telecom to $24 from $31, citing concerns about wireless growth. Article

And Finally... Wireless comes to the most remote place on earth: Timbuktu. Article