Lumen CEO says ‘more focused’ return to fibre after hitting stop button

Lumen CEO says ‘more focused’ return to fibre after hitting stop button

Lumen Technologies Kate Johnson

Kate Johnson, the new CEO of Lumen, has confirmed that its pause in building out fibre “was more of a stop button than a pause button”.

In a results call this week Johnson (pictured), who joined Lumen just months ago after leading Microsoft US, the software group’s largest business unit, said she was now imposing a “more focused build target” for the fibre-to-the-premises (FTTP) project, which is called Quantum.

“We believe the overall Quantum enablement opportunity is 8 million to 10 million locations. The engine is revving back up, and we’re aggressively working to ramp our build activities in 2023,” she said.

That target is over a number of years, and it’s clear from what Johnson and CFO Chris Stansbury said that build-out will be much slower than forecast by the previous leadership.

Johnson said: “There’s hard work ahead for our team as we make significant changes to how we serve our customers and how we execute for better financial results. 2023 will be a year of rapid change for Lumen as we execute on our plans and pivot toward growth.”

Now, “Quantum is a more focused build target where we’re able to achieve proper returns for shareholders”, she said.

Johnson, who has held leadership positions in Oracle and General Electric as well as Microsoft, noted that “Lumen is the product of many mergers, and as such, we’ve been forced to drive operational efficiency to ensure we achieve the synergies and the value intended from combining these entities.”

Lumen’s ancestry includes CenturyLink, Embarq, Qwest, Savvis and Level 3 Communications, which itself included Global Crossing.

“And that takes a fair amount of looking inward, and we’ve built thick muscle memory doing this,” said Johnson.

She said the company will now focus on two customer groups. “The first group includes large customers in the public sector, large enterprise, and upper mid-market channels”, she said.

“These organizations offer require extensive intricate and customized solutions. And to serve this group, we aim to offer scalable solutions with a higher level of personal engagement in a robust set of managed service offerings.”

The second group includes consumers, small and medium business and lower mid-market channels, said Johnson. “This group tends to prefer a less hands-on approach and often utilizes self-service options.”

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