UPDATED with additional context

Verizon Communications’s Lowell McAdam, the telco giant’s CEO since 2011 and chairman since 2012, is retiring, the company said today. He will be replaced by Hans E. Vestberg, Verizon’s EVP and President of Global Networks and Chief Technology Officer, beginning August 1.

McAdam, 64, will serve as Executive Chairman of the Board through his retirement from the company at year’s end, after which he will become Non-Executive Chairman.

Vestberg, 52, joined Verizon just more than a year ago, coming from a six-year stint Sweden’s networking and telco giant Ericsson. The board’s selection of the newcomer, who has been responsible for overseeing the deployment of next-generation 5G mobile services, signals the significance the company places on an emerging technology that will deliver faster internet connections and download speeds and play a critical role in a range of emerging technologies, including self-driving vehicles and internet connected devices.

The company said today that “Vestberg has spearheaded Verizon’s efforts to deliver seamless experiences for customers over the company’s network, while demonstrating a willingness to disrupt established processes and practices to make Verizon stronger and more efficient.”

Verizon
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Verizon’s stock has grown about 35% in McAdam’s tenure according to the Wall Street Journal, better that AT&T. But unlike its wireless rival it has not made inroads in Hollywood to grow beyond its maturing core business. Verizon took a close look at 21st Century Fox’s studio assets before the Disney deal was announced, and has been seen as an interested party in regard to companies such as Lionsgate, Viacom and CBS.

McAdam sought instead to diversify Verizon’s business by investing in digital content. Under his tenure, the company spent billions to acquire companies like AOL and Yahoo in the hopes of building an online advertising powerhouse to challenge Google and Facebook.

“I strongly believe in the power of change to drive long-term growth and innovation,” McAdam said in a company release announcing the news. “For Verizon, the time for a change in leadership is now, and I am confident that Hans is the right person to bring Verizon through its next chapter. Hans is an energizing force who will continue to position Verizon to lead the Fourth Industrial Revolution – the emergence of technologies that blend the physical and the digital to create historic breakthroughs in connectivity and mobility.”

During McAdam’s tenure Verizon has made more than $120 billion in capital investments, including spectrum purchases, to enhance its networks, focused on deals to grow its wireless, media and broadband services. Verizon’s says it has returned more than $54 billion to shareholders in cash dividends since 2011.

One of McAdam’s signature deals was Verizon’s $130 billion buyout of Vodafone’s 45% stake in the U.S. wireless company, a deal which gave the company full access to the profits from its mobile operations and the resources to invest in its mobile network and fend off challengers.

Vestberg inherits a company that is losing its most valuable monthly subscribers and facing the threat of intensifying competition, as smaller, scrappier rivals Sprint and T-Mobile try once again to merge.