Virgin Media O2 plans job cuts as part of £800m savings drive
Virgin Media O2 is planning job cuts as part of a cost-cutting drive that aims to save £800m a year by 2029, according to the Guardian. The cuts could affect as many as 25% of the company's workforce, which the Guardian reports stands at 16,000 people.
The company is a telecoms provider jointly owned by Liberty Global and Telefónica. It carries a £22bn debt pile, the same report says. On 31 October, Reuters reported, citing Sky News, that the company was set to cut thousands of jobs. Reuters also noted that the company's debt was valued at $29.46 billion.
Of the £800m target, £300m is to come from job cuts. The company plans to reduce its employee wage bill, meaning the total amount it pays staff, by 30% over the next two years. Virgin Media O2 said most of the job losses will come from roles that do not deal directly with customers. Chief executive Lutz Schüler leads the company.
The savings plan also covers other areas. Virgin Media O2 intends to use more AI tools in customer service, network planning and fault management, where a fault is a break or problem in the network. It also plans to cut back on contractors and to review its suppliers and supply chain contracts.
The plan affects the company's network build as well. Its full-fibre upgrade, which replaces older copper lines with fibre-optic cables running to homes, is 50% complete. Virgin Media O2 is halting investment in upgrading the network to full fibre beyond its existing commitments with partners. Instead, it is exploring wholesale deals, agreements that let it sell services over networks it does not own, to reach areas its own network does not cover. The Guardian reports that it is close to a deal with BT's Openreach, the network arm of BT, that would extend its footprint from 19 million homes to potentially 25 million.
The company has made large workforce reductions before. In July 2023, Reuters reported that Virgin Media O2 had planned to lay off up to 2,000 employees by the end of that year.
