Last month, Verizon announced that Sowmyanarayan Sampath would be taking on the role of CEO of Verizon Business, succeeding Tami Erwin. He starts his new role today, reporting directly to Verizon Chairman and CEO Hans Vestberg.
Sampath grew up in India and continued his education in the U.S., getting his MBA at Boston University. He worked at consulting firms KPMG and Boston Consulting Group before joining Verizon in 2014.
He most recently served as chief revenue officer for Verizon Business. His other roles at Verizon include president of Global Enterprise, where he spearheaded the commercial launch of Verizon’s 5G networks and multi-access edge computing (MEC) solutions.
He’s got big shoes to fill. Erwin spent 35 years at Verizon and served as Verizon Business CEO since 2019. Before that, she played a role in growing Verizon’s wireline and wireless business segments. For a while, she headed up operations for Verizon Wireless.
Leading with kindness, FWA momentum
In an interview with Fierce, Sampath said his management style includes leading with kindness and integrity. “I have never had a situation that could not have been taken care of with kindness,” he said.
For example, he recently held an operations review with a team that wasn’t doing that well. Instead of going into “command-and-control” mode and just chewing them out, he wanted to find out what was getting in their way.
“I think in conversation you uncover things that are just so useful and impactful in changing the course,” he explained. “How you handle these conversations is important… Understanding what is going on in people’s minds, giving them the space to share it and collaborating with them to find a solution.”
Business is doing “incredibly well,” he said of Verizon Business, which reported $7.7 billion in total revenue in the first quarter of 2022. Verizon has a 44% market share in the enterprise space and growing, he said.
“I think you’re seeing strong momentum in the business on the wireless side,” he said. “We’re seeing very good traction on private networks and some early traction on the mobile edge compute. Fixed wireless access has been our hero product for the last couple of quarters.”
In the first quarter of 2022, Verizon added more than 80,000 business customers for its fixed wireless access (FWA) product. Some 80% of them are using it as a primary service, and 50% are coming directly from cable. Another 50% are use cases that cable can’t go after – such as food trucks, kiosks, curbside pick-up, where mobility comes into play.
“It’s a very compelling, new market for us,” he said, adding that ARPU is almost two and a half times that of smartphone ARPU, and there’s no subsidy on the phones. “It’s good for customers and it’s good for shareholders.”
It’s worth noting that while T-Mobile continues to expand its FWA offering, Verizon’s fellow wireline competitor AT&T is not embracing it as a long-term solution. “We’re committed to this technology,” Sampath said of FWA.
Maintaining public sector leadership
Besides small, medium and large business accounts, he is now also responsible for Verizon's public sector business. Verizon traditionally held the lion’s share of the public safety market, and according to Sampath, that isn’t changing even though AT&T won the FirstNet contract, which is all about providing a dedicated wireless network for public safety.
Verizon still has the biggest share of the public safety market “by a country mile,” he said. “People ask why. Our network is built for public safety.” In addition, “we have very deep operational relationships with these agencies,” such as when they need extra capacity. “Despite a lot of talk about others taking share, I don’t see it on a day-to-day basis.”
As for C-band spectrum, which Verizon spent more than $50 billion to acquire, he said it’s providing even better coverage and throughput that what they were expecting.
“We are seeing much better performance,” in terms of penetration within buildings as well as throughput, he said. With that, and Verizon’s ecosystem of devices, “we continue to take share… I am not defending anything there. I’m playing an offensive game and taking share.”
Private networks as gateway to MEC
Another area he highlighted is private networks and MEC, where it has hundreds of opportunities in the funnel, he said.
“I think we’re the only carrier who has tied up with Nokia, Ericsson and Celona” on one side of the equation, and on the other side, it has deals with the three hyperscalers Google, Microsoft and Amazon. “So we have an offering that literally no one else on earth can put together.”
As for MEC, “this is the year we start getting into some early commercial deployments. Revenue will start hitting at the back end of next year, but this is where we start getting some commercial traction,” he said. “Private networks for us are the gateway to the MEC.”
Customers in this space include logistics and warehousing. For a lot of big enterprise customers, Wi-Fi alone just doesn’t cut it for them, according to Sampath.
For example, the Associated British Ports (ABP) in the U.K. at one time had more than 200 Wi-Fi access points. Verizon replaced those with seven network nodes. Every situation differs somewhat, but that’s indicative of the kinds of reductions in costs that can come with a private network, he said.
When Verizon has a standalone (SA) 5G core, it will be able to offer network slicing, but it hasn’t disclosed yet when that’s going to happen – and it needs the devices to support it. Until then, it’s encouraging customers to get started now with private networks.
What about the competition?
T-Mobile is making greater efforts than it’s ever done in order to increase its share of the enterprise market. T-Mobile’s share in the enterprise space is less than 10% and it’s made clear its intentions to more than double that within the next four years.
Sampath said that basically means that in a few years, T-Mobile wants to get to less than half of Verizon’s share, or 20%. “That’s aspirational for them,” he said. “We have 44%. By definition, we have the most share.”
He also said there are a few things that are going to make it difficult for T-Mobile.
For one, “our network is business-grade,” he said, suggesting that’s something T-Mobile can’t match.
Second is distribution. “We have one of the largest distribution networks in the world” around these services, with both inside sales teams and on the street, and “it’s not easy for people to replicate this network.”
Third is customer success teams, which have all the digital tools to serve enterprise and B2B customers, he said.
Taking vs. keeping share
How much wireless share does AT&T command for enterprise? Industry analyst Chetan Sharma, who heads Chetan Sharma Consulting, said it can quickly get confusing as to how carriers are segmenting their customers. The 44% share that Sampath cited might include connectivity/smartphones in the enterprise market; Verizon wasn’t able to immediately verify that.
If you take wireless phones out of the mix, “AT&T is ahead of Verizon,” in the enterprise space, Sharma said. In the connected car space, for example, AT&T commands a large majority of the business in the U.S. “IoT in general and connected devices in general, AT&T is ahead,” he said.
As for T-Mobile, it now has the 5G network to match and exceed that of the two other operators, he said “They can really go after the enterprise accounts and offer them reliability, coverage and the pricing, so they can starting peeling off enterprise customers from the top two players,” Sharma said. “They are an extremely credible threat.”