KPN has named Maximo Ibarra the successor to its CEO Eelco Blok. The proposal from the supervisory board still needs to be approved at an EGM. Ibarra will take up the position after the AGM on 18 April 2018, but starts already in January as an adviser to the Dutch operator. Ibarra has a long CV, with positions both in telecom (Wind Tre, Vodafone Italia, Telecom Italia) and other sectors (Benetton, Fiat, DHL). He has Italian and Colombian nationality. KPN's press release suggests its supervisory board is planning a serious change in course for the company, which may involve consolidation or a new strategy.
Blok's departure has not raised any conspiracy theories. He served two good terms as CEO, performed well and now finds it time for something else. He had an unfortunate start at KPN, right when the rise of WhatsApp started destroying SMS revenues. Blok then made a name for himself with profit warnings and lower dividends, culminating in a rights issue. Still, it all ended well. He narrowed the company's focus to its home market the Netherlands, simplified operations and started the expansion in the IT market.
Telecom is an international business
That KPN has not named an internal candidate or even a Dutch person as CEO is somewhat surprising. Nevertheless, the Dutch telecom sector is especially international. Think of other executives like Rene Obermann (from Deutsche Telekom to Ziggo and Inexio), Jeroen Hoencamp (from Vodafone UK to VodafoneZiggo), Jaap Postma (from KPN to TDC/YouSee) or Jon James (from Com Hem to Tele2 NL). KPN's board wanted the best wo/man for the job, and perhaps they found it time for some new blood. Blok and his predecessors Scheepbouwer and Smit all came from the KPN stable.
Time for change?
Blok's arrival led to a major shake-up of the management, with several top managers leaving the company. While it's not yet known what Ibarra's plans for KPN are, the company's press releases suggests a few things, noting that he "successfully led the merger between Wind and H3G" and he is "able to navigate KPN into its next phase". These are very suggestive statements.
- Should KPN join in the pan-European consolidation (Deutsche Telekom), as Blok suggested several years ago? Perhaps only if it's not a global player, like America Movil, which was already rejected by the Dutch company.
- Is the aim a regional merger (Proximus), similar to the merger of Wind and Tre in Italy, led by Ibarra?
- Or does the strategy need a complete rethink?
Answer to VodafoneZiggo?
KPN's increased focus on the IT market, through a string of small acquisitions, is perhaps its most important shift in strategy as of late. This is already well underway though, and doesn't need Ibarra. The most important recent development on the Dutch market is the creation of VodafoneZiggo, merging KPN's biggest competitors on the mobile and fixed segments. This creates a wide range of questions and risks:
- How will regulation change? Could it lead to open cable networks?
- In terms of competition: will VodafoneZiggo continue with copying KPN or is the real innovation yet to come?
- What will happen with the business market?
If the KPN and VodafoneZiggo 'duopoly' continues in terms of network innovation, will the roll-out of Docsis 3.1 lead to a renewed focus on FTTH at KPN? In Belgium, we've already seen Proximus launch its 'Fiber For Belgium' plan in response to Telenet's major network plan 'De Grote Netwerf'.
Ibarra will be starting work relatively soon, so we should know more from early next year about KPN's strategy and independence.
