Virgin Media O2 is preparing to cut thousands of jobs, according to the BBC. The broadband provider has not finalised how many roles will go, but the BBC understands the cuts are likely to affect a sizeable share of its 16,000 workforce.
The company declined to comment. The Prospect union, which represents VMO2 staff, called the cuts "disappointing and very unsettling." Deputy general secretary Noel McClean said the union is "committed to supporting our members through what is a difficult time," and is working with employers to explore ways to reduce redundancies and ensure retraining and redeployment.
The BBC has been told most affected staff will work in non-customer-facing roles. A number of senior leadership changes are already under way. VMO2 is also expected to review its use of contractors and suppliers alongside the cuts, which Sky News first reported.
As of 30 June, VMO2's total debt stood at £27.2bn, against assets of £45.9bn, according to its latest accounts. The company faces competition from cheaper "altnets" such as Hyperoptic, Community Fibre, Gigaclear, and YouFibre, as well as from BT, which the Competition and Markets Authority cleared to acquire TalkTalk in October. VMO2 called that takeover a "stitch-up."
VMO2 tried to respond by agreeing to buy altnet Netomnia for £2bn through nexfibre, a joint venture owned by its owners. The Competition Markets Authority has provisionally found competition concerns in that deal, with a final decision due in December.
The Financial Times reported on Friday that VMO2 was close to agreeing a deal to use BT's fibre broadband network. BT's share price rose 7% after the report. The BBC has been told the deal is very close and that VMO2 is highly likely to announce it will stop all investment in fibre in its results on Tuesday. The BBC has not confirmed these details independently.