The top five innovative thinkers in telecom drive technology and their brands forward, and they are well compensated for it. Staying one or two steps ahead of the competition in the highly competitive wireless industry requires an above-average business sense and the ability to think big and bold. The fast-moving and ever-changing telecom industry may pay its chief executive officers (CEOs) 500 to 600 times the average worker’s pay, but CEOs are responsible for generating billions of dollars of revenue each year.
Marcelo Claure, Sprint
Marcelo Claure, CEO of Sprint Corporation (S), tops the list of highest earners in the telecommunication industry. Claure started with Sprint in August 2014 and received a prorated compensation of $21.8 million for the eight months he was with the company in fiscal year 2014. His compensation package included a base salary of $923,077, a signing bonus of $500,000, additional bonuses totaling more than $2.4 million and stock awards and stock options worth almost $20 million.
A wireless industry distribution entrepreneur, Claure founded Brightstar Corp. in 1997 and led the company to earn $10.5 billion in gross revenue. At Sprint, Claure’s focus is on subscriber growth, especially postpaid customers. He made an immediate impact: Sprint reported an operating income of $318 million and adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $1.7 billion in the fourth fiscal quarter 2014.
Randall L. Stephenson, AT&T
Though Randall L. Stephenson, the CEO and president of AT&T, Inc. (T), received higher compensation than Sprint’s Claure, Stephenson’s numbers were for the entire 2014 fiscal year, whereas Claure’s were for only eight months. In comparison, Claure comes out on top. However, Stephenson has nothing to complain about, as his total compensation for fiscal year 2014 was $24 million. That breaks down to $1.7 million in salary, $14 million in stock and stock options and $6.5 million in bonuses and other compensation.
Stephenson grew AT&T to be worth $173 billion through its three divisions: wireless, wireline and other. A longtime employee of AT&T and its predecessor, SBC Communications, Stephenson took over as CEO in May 2007 and was named president one month later. The timing corresponded with the release of the iPhone and AT&T as the cutting-edge smartphone’s sole service provider.
John J. Legere, T-Mobile
Formerly at the top of the list, John J. Legere, CEO of T-Mobile (TMUS), has dropped down two spots to number three for fiscal year 2014 due to a $10 million reduction in compensation from the previous year. His total compensation package for 2014 was worth $18.57 million. This breaks down to a base salary of $1.25 million, $10.66 million in stock awards (down from $22.5 million in 2013) and $4.83 million from a non-equity incentive plan.
Legere joined T-Mobile as CEO in September 2012. His claim to fame came from reinventing himself to connect with the hot millennial market and for taking the bold approach of no contracts for wireless customers. Both strategies worked well, as T-Mobile added 8.3 million total wireless customers in 2014.
Lowell McAdam, Verizon Communications
Lowell McAdam, CEO of Verizon Communications, Inc. (VZ), saw nearly a 16% increase in his compensation for fiscal year 2014 from the previous year. The $18.3 million he received in 2014 breaks down to $1.6 million in base salary, $12 million in stock awards and more than $4 million in bonuses and other income.
McAdam took over the position of CEO in 2011, and during his tenure has grown Verizon to be the number one wireless provider in the United States. Verizon Wireless serves approximately 137 million customers, according to Hoover's. Verizon also offers wireline, internet, digital TV and mobile video service.
Glen F. Post, III, CenturyLink
Rounding out the list as the fifth-highest paid telecom executive is Glen F. Post, III, CEO of CenturyLink, Inc. (CTL). Post received compensation of $13.1 million in fiscal year 2014. This included a $1.1 million base salary, stock awards of $9.6 million plus bonuses and other compensation.
CenturyLink offers phone, internet and cable TV services. Post has held the CEO position since 1992 and in that time has grown the company to become the third-largest U.S.-based telecom company behind AT&T and Verizon. CenturyLink had operating revenues of $18 billion for 2014.
The Bottom Line
CEOs of telecom companies do get paid quite a lot of money, but they provide a level of talent that keeps their companies at the top of the field while generating billions of dollars in revenue. There are few people who possess the necessary skills to perform such jobs. A CEO’s compensation is also an indication of how well the company is doing overall. Base salary is usually only around 20% of total compensation, and the remainder is based on the company’s performance.