UK's Virgin Media O2 to slash jobs, halt fibre roll-out

Virgin Media O2 to Cut Jobs and Halt Fibre Expansion in UK Strategy Shift

Virgin Media O2 Announces Major Strategic Changes

Job Cuts and Fibre Roll-Out Halt

LONDON, Nov 3 (Reuters) - British mobile and broadband company Virgin Media O2 is cutting jobs, halting its fibre roll-out and is in talks to use its bigger rival BT's network, as it seeks to increase its profitability and reduce debt.

The company, jointly owned by Liberty Global and Telefonica, is being squeezed by the roll-out of BT's fibre network and scores of small "alt-nets".

Details of Job Reductions

It said on Tuesday it would cut around 30% of its total people costs, with the majority of the reduction coming from non-customer facing roles. The group employs 15,000 people.

CEO's Statement on the Changes

Chief Executive Lutz Schüler said the changes were tough but necessary.

"Given the market conditions we face, the regulatory backdrop in fibre and the technological changes sweeping across all areas of the economy, standing still and doing what we’ve always done is not an option," he said.

Financial Performance and Market Challenges

The challenge facing the group was clear in its third-quarter results, with a loss of 23,300 fixed line customers taking its total to 5.5 million.

Its total revenue for the quarter fell 5.7% to £2.4 billion ($3.22 billion) and adjusted core earnings fell 2.6% to £995 million.

Exchange Rate Information

($1 = 0.7460 pounds)

(Reporting by Paul Sandle; Editing by Kate Holton)